Investors punished Meta for its exorbitant artificial intelligence spending plans, which outstripped more restrained investment from Alphabet and Microsoft.
Meta raised its capital expenditures for this year to between $70bn and $72bn, up from its previous guidance of $66bn to $72bn.
The company also flagged that additions to its spending plans for 2026 would be “notably larger” than the roughly $30bn it expects to add to capex budgets in 2025.
Mark Zuckerberg defended the decision, telling analysts on a call that it was “the right strategy to aggressively frontload building capacity, so that way we’re prepared for the most optimistic cases”.
Meta shares slid more than 8 per cent in after-hours trading on Wednesday. That equates to a market capitalisation wipeout of about $160bn, which would rank as the stock’s second-biggest on record.
Alphabet, meanwhile, reported better than forecast quarterly net income and revenue, which topped $100bn for the first time. Shares rose more than 6 per cent after the closing bell.
Microsoft also reported revenue and net income that topped Wall Street’s median forecast, but growth in its Azure cloud computing business fell short of the most bullish expectations.
Hopes were high for a stronger result from the unit given the company’s deal this week to supply more computing power to OpenAI. Microsoft’s shares dipped 3.6 per cent.