Meta shares fell 15% on Wall Street when it opened on Thursday. This wiped out $190bn from the parent company of Facebook and Instagram. Investors reacted after a promise to increase spending for artificial intelligence.
Mark Zuckerberg (founder and CEO of Meta) said in a Wednesday conference call that the company’s spending on AI technology must increase “meaningfully” for it to generate “a lot” of revenue.
In 2023, shares of Meta were boosted by Zuckerberg’s aggressive action on costs during what he called a “year of efficiency”. Investors have been rattled by a relaxation of this restraint after Meta raised its upper limit of capital expenditure guidance from $37bn up to $40bn on Wednesday.
Meta launched Llama 3 last week, the newest version of its AI model. It also released an image generator which updates images in real-time while users type prompts. Meta AI’s AI assistant is now available in over a dozen countries outside of the US, including Australia. Canada, Singapore and Nigeria. Chris Cox said that Meta’s Chief Product Officer was still “working on the best way to do it in Europe”.
Meta’s share price fell after a record-breaking gain in value in February. The company had added $196bn in stock market capitalisation, a measure for a company’s worth, following the declaration of its first dividend. It was at the time the largest one-day gain on Wall Street.
Nvidia, the world’s leading chip supplier for AI training and operation, smashed this record weeks later with a gain of $277bn.
Post Disclaimer
The following content has been published by Stockmark.IT. All information utilised in the creation of this communication has been gathered from publicly available sources that we consider reliable. Nevertheless, we cannot guarantee the accuracy or completeness of this communication.
This communication is intended solely for informational purposes and should not be construed as an offer, recommendation, solicitation, inducement, or invitation by or on behalf of the Company or any affiliates to engage in any investment activities. The opinions and views expressed by the authors are their own and do not necessarily reflect those of the Company, its affiliates, or any other third party.
The services and products mentioned in this communication may not be suitable for all recipients, by continuing to read this website and its content you agree to the terms of this disclaimer.