Meta Stock Loses $175 Billion After AI Expense Estimate Shakes Shareholders

2 hours ago 19

Meta Platforms (META) shares dropped roughly 10% on Thursday, erasing about $175 billion in market value. A higher 2026 capital expenditure forecast of $125 billion to $145 billion triggered the selloff.

The decline marked the stock’s largest single-day percentage drop in roughly six months. It came despite Q1 2026 earnings that exceeded Wall Street estimates on both revenue and profit.

Capex Hike Spooks META Investors

As of this writing, META stock was trading for $606.43, down by almost 10% in the last 24 hours, wiping out up top $175 billion from its market cap today alone.

The new spending range sits roughly 7% above the previous January guidance of $115 billion to $135 billion.

Chief Financial Officer Susan Li attributed the increase to higher memory-chip pricing. She also cited additional data center costs tied to artificial intelligence (AI) infrastructure.

$META CFO Susan Li says headcount reductions that they announced last week will help offset increased spending in AI infrastructure.

My take: Latest data point that AI is having an impact on employment.

— Gene Munster (@munster_gene) April 29, 2026

JPMorgan analyst Doug Anmuth downgraded Meta to Neutral and cut the bank’s price target to $725 from $825. The note flagged intensifying full-stack AI competition and a more challenging path to returns.

Q1 capex alone reached $19.8 billion, in line with the broader Big Tech race in AI infrastructure.

Earnings Beat Overshadowed

Meta reported revenue of $56.31 billion, up 33% year over year, the strongest quarterly growth since 2021. Net income reached $26.8 billion, or $10.44 per diluted share. An $8 billion one-time tax benefit tied to U.S. Treasury R&D guidance lifted that figure.

*AMAZON 1Q NET SALES $181.52B, EST. $177.23B

*AMAZON SEES 2Q NET SALES $194.0B TO $199.0B, EST. $189.15B

*META 1Q REV. $56.31B, EST. $55.51B

*META SEES 2Q REV. $58B TO $61B, EST. $59.56B

*MICROSOFT 3Q REV. $82.89B, EST. $81.46B

*MICROSOFT 3Q OPER INCOME $38.40B, EST. $36.9B…

— MartyParty (@martypartymusic) April 29, 2026

Ad revenue stayed strong as AI-powered content recommendations boosted engagement on Reels and video.

Yet the reaction echoed earlier sell-offs after prior Meta capex hikes. The pattern repeatedly overshadows strong fundamentals with spending fears.

CEO Mark Zuckerberg defended the strategy on the call. He framed the higher outlay as a vote of confidence in Meta’s AI roadmap.

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