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Why did Meta stock drop more than 10%?

Asked 7 hours ago

Answer

Meta stock drops over 10% after CEO Mark Zuckerberg announces a $70 billion commitment to AI spending for the year, raising investor concerns about unclear short-term returns and heavy reliance on advertising revenue. Competitive pressures from lower-cost Chinese AI firms and comparisons to more diversified tech giants like Microsoft and Alphabet intensify market uncertainty.

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CBS News

Meta stock falls over 10% after commitment to raise AI spending

CBS News ยท New
CBS News
CBS News
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  • Meta's stock fell over 10% after CEO Mark Zuckerberg announced plans to increase AI spending. 1m 30s
  • Meta plans to spend $70 billion on AI this year, representing a significant portion of its annual revenue. 1m 56s
  • Investors are concerned about Meta's heavy reliance on advertising and the unclear returns from its AI investment. 2m 2s
  • Other tech giants like Microsoft and Alphabet are also making large AI investments, but have more diversified revenue sources. 2m 12s
  • Chinese companies, such as DeepSeek, are developing AI solutions at lower costs, increasing competitive pressure. 2m 31s
Companies & StartupsTechnologyBusinessArtificial Intelligence

References

Meta stock falls over 10% after commitment to raise AI spending
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CBS News
9 hours ago
Meta stock falls over 10% after commitment to raise AI spending

Meta commits to spend $70 billion on AI this year, sparking investor concerns about unclear short-term returns and heavy reliance on advertising revenue, leading to a stock drop of over 10%.

Meta stock falls over 10% after commitment to raise AI spending
Icon
CBS News
9 hours ago
Meta stock falls over 10% after commitment to raise AI spending

Investors are not fully convinced by the massive AI spending, questioning whether the large investments will yield returns, contributing to Meta's stock decline.

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