Meta (META) shares dropped 15% in after-hours trading after the firm said it will “aggressively” ramp up spending in artificial intelligence spending while its metaverse division will continue to run at a loss — amid a weak revenue outlook.
The giant said in its April 24 first quarter 2024 results it expected expenses to rise to a range between $96 billion to $99 billion — up from $94 billion to $99 billion due to “higher infrastructure and legal costs.”
It also bumped full-year 2024 capital expenditures to a top end of $40 billion from its prior $37 billion as it would “invest aggressively to support our ambitious AI research and product development.”
Its metaverse building Reality Labs lost $3.85 billion in Q1 — down from nearly $4 billion it lost in Q1 2023 — but Meta said expected these losses to increase year-on-year to bankroll the division’s product development.
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Meta shares slid 15.4% after-hours on April 24 to $417.22 following it closing the day down 0.5% at $493.50, according to Google Finance.
Meta is, however, still up 42.5% year-to-date after hitting an all-time high of $527.34 earlier this month on April 5.
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This is a developing story, and further information will be added as it becomes available.
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