Meta Shares Slide Nearly 10% on AI Spend Surge While Google Climbs 6%

TL;DR: Meta’s stock dropped almost 10% at the open after revealing a $33.4 billion AI expense jump, while Alphabet’s shares rose over 6% on strong AI-driven earnings.

On Thursday morning, Wall Street reacted sharply to the contrasting earnings reports from two of the world’s biggest tech firms.

Meta disclosed that its total expenses climbed to $33.4 billion as it pursues superintelligence and hires top AI talent. The company also lifted its projected capital spending for data centers by $10 billion, setting a new annual range of $125 billion to $145 billion. Unlike its rivals, Meta’s AI investments are not yet tied to a direct revenue stream.

Alphabet, meanwhile, reported profit of $62.6 billion on revenue just shy of $110 billion, easily beating last year’s figures and market expectations. Its shares rose over 6% following the earnings release, reflecting investor confidence in its AI pivot and steady performance across advertising, cloud and other divisions.

Amazon and Microsoft, which also posted earnings on Wednesday, saw their shares slip 2% and 3.7% respectively amid similar AI spending concerns. The broader market showed mixed moves, with the Dow Jones up 0.8% near 49,241, the S&P 500 gaining 0.2% to about 7,151, and the Nasdaq flat around 24,665.

The divergence highlights a growing split: investors reward companies that can monetize AI quickly, while they penalize those whose AI bets remain largely cost‑driven without clear near‑term returns.

What to watch next: whether Meta’s hiring spree and capital outlay begin to generate measurable AI‑related revenue, and if Alphabet can sustain its growth trajectory amid intensifying competition.