CNBC’s Deirdre Bosa joins 'Money Movers' to discuss Meta's AI talent spending spree.

The release of Open AI's ChatGPT has accelerated the development of artificial intelligence and warnings about its impact on society.

Rise of AI

Meta has ramped up its investment in artificial intelligence by aggressively recruiting top researchers, particularly from OpenAI. Reports indicate Meta has offered compensation packages of around $100 million each to eight former OpenAI researchers, totaling nearly $1 billion, alongside additional spending on other AI talent and infrastructure.

The company's projected expenses for the coming year are expected to reach up to $119 billion, a significant increase from previous years. This surge in spending has been met with a positive market response, with Meta's shares reaching all-time highs. OpenAI leadership has acknowledged the impact of Meta's recruitment efforts, promising to adjust compensation and retain key talent.

Meta escalated talent war with OpenAI

Shares of Meta heading a fresh all-time high as it pushes full steam ahead on its AI talent spending spree, according to new reports. Deirdre Bosa digging in for today's tech check, Deirdre. So they've been successful at acquiring people? They've been pretty successful, despite Sam Altman's best efforts. And really, this is about the talent spend. It's really becoming a new signal to investors, a show of strength where the edge comes from the people who can build what's actually next. And kind of just like CapEx in the first few years of the race, no one wants to be the first to pull back because cutting comp, it now doesn't just risk losing talent, but it risks signaling to the market that you're losing momentum. Meta poaching now eight, as far as we know, top researchers from OpenAI. Let's assume, based on reports, eight packages at $100 million each. That's nearly a billion dollars in comp, plus more than $14 billion for scale AIs, Alexander Wang, undisclosed amounts for Nat Friedman and Daniel Gross, and reportedly a fresh wave of offers still outstanding. Add in enormous CapEx numbers and we have far surpassed Metaverse levels of spending. Meta told investors that it's expecting 2025 expenses to be in the range of $114 to $119 billion. That's up from about $70 billion in 2021. That was peak Metaverse hype levels. And it was also just before investors lost patience and punished shares some 65 percent the next year in 2022. Now, Zuckerberg, of course, he is betting that this time is different, that his years long push for efficiency and other parts of the business gives him leeway to go on another spending spree, this time in AI, which is, of course, a more attractive, a more sustainable bet to investors. So far, that is working. Shares are at all time highs this morning and he has successfully rattled his biggest rival in the space. Despite Sam Altman's best efforts to publicly downplay these efforts to recruit and call Zuckerberg's approach a side quest, the reaction inside OpenAI tells a different story. In a memo to employees over the weekend, a source confirms Wires reporting that OpenAI's chief research officer described it as if, quote, someone has broken into our home and stolen something. He vowed to be proactive and creative to recalibrate comp, to recognize and reward top talent. And maybe, guys, a final tell. OpenAI, the company with 80 hour work weeks that is working relentlessly to get to AGI, Artificial General Intelligence. It's mostly shut down this week. This is a scheduled recharge, but it could give Zuckerberg the opportunity to continue to chase even more talent.

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Meta escalated talent war with OpenAI

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Rise of AI