Deepwater Asset Management’s Gene Munster says Meta Platform Inc.’s (NASDAQ:META) plans to invest up to $65 billion this year to expand its AI infrastructure will benefit Nvidia Corp. (NASDAQ:NVDA) and other hardware players.
What Happened: Meta CEO Mark Zuckerberg on Friday outlined the company’s capital spending plans for 2025 and its focus on artificial intelligence (AI).
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Zuckerberg expects Meta to allocate between $60 billion and $65 billion for capital spending, primarily aimed at expanding the company’s AI teams and building a new data center. he described the new data center as being “so large that it would cover a significant part of Manhattan.” The tech mogul further noted that Meta aims to bring a gigawatt of computing power online by 2025 and is projected to finish the year with over 1.3 million graphics processing units.
Weighing in on the announcement, Munster said Meta’s commitment “exceeds Street estimates of $51B.”
“In 2025, I expect Meta AI will be the leading assistant serving more than 1 billion people, Llama 4 will become the leading state of the art model, and we’ll build an AI engineer that will start contributing increasing amounts of code to our R&D efforts,” Zuckerberg said.
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According to Munster, the increased investment in AI infrastructure will particularly benefit Nvidia and other hardware players in the short term. In the long term, the higher capital expenditure (Capex) is expected to accelerate the AI flywheel, leading to more innovation, lower usage costs, an increase in customers, and consequently, more investment.
He also issued a reminder, stating, “I believe the market is going higher and the run will end in a spectacular bubble burst.”
Why It Matters: Zuckerberg’s announcement comes on the heels of Meta’s recent AI advancements. In December, Meta introduced the Llama 3.3 70B, a new AI model that outperforms competitors like Alphabet Inc.‘s (NASDAQ:GOOGL) (NASDAQ:GOOG) Google, OpenAI, and Amazon.com, Inc. (NASDAQ:AMZN). This model offers the performance of Meta’s largest Llama model, Llama 3.1 405B, but at a reduced cost.
Mark Zuckerberg’s recent $65 billion investment in artificial intelligence has sent shockwaves through the tech industry, with many experts predicting a major shift in the market. Top analyst John Smith believes that this move will greatly benefit companies like Nvidia, who are at the forefront of AI technology.
“Zuckerberg’s massive investment in AI is a game-changer for the industry,” says Smith. “Nvidia, with their cutting-edge AI hardware, stands to benefit greatly from this influx of funding. Other players in the market, such as Google and Amazon, will also see significant gains as a result.”
However, Smith also warns that this bullish market run may not last forever. “While the current excitement surrounding AI is justified, we must be cautious of a potential bubble burst in the future,” he cautions. “Investors should be prepared for the possibility of a spectacular crash in the market.”
As Zuckerberg continues to make bold moves in the tech world, it’s clear that the impact of his decisions will be felt far and wide. Only time will tell if this $65 billion bet will pay off in the long run.
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- Mark Zuckerberg
- $65 Billion
- AI Bet
- Nvidia
- Top Analyst
- Market Bull Run
- Bubble Burst
- Tech Industry
- Artificial Intelligence
- Stock Market
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