Meta CEO Mark Zuckerberg looks on before the luncheon on the inauguration day of U.S. President Donald Trump’s second Presidential term in Washington, U.S., Jan. 20, 2025.
Evelyn Hockstein | Reuters
Mark Zuckerberg’s plan is to make Meta the market leader in artificial intelligence. Investors will wish to understand how President Donald Trump’s tariffs-heavy trade policies will impact that strategy.
Those answers could start to return as soon as this week as Meta’s AI strategy takes center stage when the corporate hosts its first Llama-branded conference for AI developers on Tuesday then reports its latest quarterly earnings the subsequent day.
Already, tech firms are beginning to talk concerning the potential impact they’re bracing for because of this of the Trump tariffs.
Intel Chief Financial Officer David Zinsner said Thursday throughout the chip giant’s first-quarter earnings call that U.S. trade policies “have increased the possibility of an economic slowdown, with the probability of a recession growing.” Meanwhile, Google CFO Anat Ashkenazi said that day during a first-quarter earnings call that the tech giant stays committed to its $75 billion investment in capital expenditures, or capex, this 12 months, but in addition acknowledged that the “timing of deliveries and construction schedules” could cause some quarter-to-quarter spending fluctuation.
For now, analysts expect Meta to follow Alphabet’s lead and remain firm in its plan to spend as much as $65 billion in capex for AI infrastructure this 12 months when it reports earnings Wednesday. Some analysts consider Meta could even raise the figure because AI is a core priority for the corporate.
“We don’t expect META to chop its CapX guidance of $60B-$65B in 2025, for its GenAI infrastructure, because they see this as an essential 10-year investment, we consider,” Needham analysts wrote in a research note published Wednesday. “Nevertheless, tariffs add risks of upward cost revisions.”
Investors will even be monitoring Meta’s LlamaCon event at its Menlo Park, California, headquarters for any signs that its AI investments are having a direct business impact. This might be the primary time Meta hosts a developer conference specifically for its Llama family of AI models.
“Investors wish to see ROI on all these AI investments, and while Meta has shown clear advantages from leveraging AI to enhance its products and drive faster revenue growth, it has been hard to quantify those advantages,” Truist Securities analyst Youssef Squali told CNBC.
Meta in April released a few its recent Llama 4 models, which Meta Chief Product Officer Chris Cox previously said might help power so-called AI agents that may perform tasks for users via web browsers and other online interfaces.
It’s important that Meta keep improving Llama to create a serious business involving AI agents that firms can use to interact with their customers inside apps like Facebook and WhatsApp, William Blair research analyst Ralph Schackart said.
“Meta has an early mover advantage at scale in a multi-trillion dollar market,” Schackart said in an email. “We consider Meta could be very well positioned to leverage its billions of worldwide users across multiple platforms.”
Meta is unlikely to curb its Llama investment anytime soon, but should eventually consider doing so if it fails to generate enough money to justify its costs, said Ken Gawrelski, a Wells Fargo managing director of equity research.
“We do consider that over time Meta must proceed to guage whether Llama must be competitive with the leading-edge models,” Gawrelski said. “This can be a very expensive proposition and so far, unlike Google, Meta does indirectly monetize its model in any material way.”
Chris Cox, Chief Product Officer at Meta Platforms, speaks during The Wall Street Journal’s WSJ Tech Live Conference in Laguna Beach, California on October 17, 2023.
Patrick T. Fallon | AFP | Getty Images
Meta AI and the buyer
Analysts are also following the Meta AI digital assistant. That is since the ChatGPT rival represents the second pillar of Zuckerberg’s AI strategy.
Zuckerberg in January said he believes 2025 “goes to be the 12 months when a extremely smart and personalized AI assistant reaches greater than 1 billion people, and I expect Meta AI to be that leading AI assistant.”
In February, CNBC reported that Meta was planning to debut a stand-alone Meta AI app throughout the second quarter and test a paid subscription service, during which users could pay monthly fees to access more powerful versions like users can with ChatGPT.
Although Meta’s enormous user base across its family of apps gives Meta AI a bonus over rivals like ChatGPT by way of reach, they could not interact with Meta AI in the identical way they do with rival chat apps, said Cantor Fitzgerald analyst Deepak Mathivanan.
Gawrelski said that individuals may not wish to use Meta AI inside Facebook and Instagram if all they wish to do is passively watch the short videos that Meta algorithmically recommends to their feeds.
“For this reason a separate Meta AI, where Meta could clearly articulate its use case and value proposition, could possibly be helpful,” Gawrelski said.
A stand-alone Meta AI app could help the corporate higher market the digital assistant and distinguish it from rivals, said Debra Aho Williamson, founder and chief analyst at Sonata Insights.
“ChatGPT has such wide brand awareness, that it’s grow to be a moat that’s soon going to be very hard to beat,” Williamson said.
