Meta to spend up to $65 billion in 2025 for AI expansion

Meta's AI ambitions lead to record-breaking stock performance this week.

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Meta Platforms is preparing to invest between $60 billion and $65 billion this year to expand its artificial intelligence (AI) infrastructure, CEO Mark Zuckerberg announced on Friday.

This marks a sharp increase from the estimated $38 billion to $40 billion the company spent in 2024, as Meta aims to solidify its position in the AI race against competitors like OpenAI and Google.

Zuckerberg described 2025 as "a defining year for AI" in a Facebook post, revealing Meta's plans to build a data centre so expansive it would cover a significant portion of Manhattan. The facility, expected to bring 1 gigawatt of computing power online in 2025, will also house over 1.3 million GPU chips by year-end, further strengthening Meta's AI capabilities.

Stock hits record high
Following the announcement, Meta's stock surged 1.7% to close at a record $647.49, surpassing a high set just a day earlier. The company’s shares have risen by nearly 65% over the past 12 months, reflecting investor confidence in its AI strategy.

The timing of the announcement coincided with the unveiling of Stargate, a $500 billion AI initiative launched earlier this week by US President Donald Trump. The project, which includes OpenAI, SoftBank, and Oracle as partners, has raised the stakes in the global AI race, spurring Meta to respond with an aggressive investment strategy.

AI ambitions take centre stage
Meta’s AI plans centre on its Llama 4 large language model, which Zuckerberg expects to serve more than 1 billion users by the end of the year. Smaller models are slated for release in early 2025, with analysts predicting a significant ramp-up in functionality.

The company is also expanding its workforce to include more AI specialists, maintaining its status as one of the largest purchasers of Nvidia’s highly sought-after AI chips. The investment in human capital and hardware underscores Meta’s commitment to leading the development of AI technologies.

Industry-wide competition
Meta’s announcement follows similar moves by industry rivals. Microsoft has committed $80 billion to data centre development in fiscal 2025, while Amazon plans to spend more than $75 billion, surpassing its 2024 investments.

Big technology firms have been pouring billions into AI infrastructure following the runaway success of OpenAI’s ChatGPT. Meta has differentiated itself with an open-source approach, offering its Llama AI models for free to consumers and businesses.

Zuckerberg's latest announcement positions Meta as a serious contender in the AI race, with analysts praising the company’s proactive approach. “Zuckerberg is signalling to the market that he does not want to be second in the AI race,” said Gil Luria, an analyst at D.A. Davidson.