Meta narrows annual capex forecast, as AI buildout grows
META•Privacy and regulatory risks remain
While investors are scrutinizing Meta's AI spending, it faces privacy-related risks tied to its smart glasses. The company said in a court filing this month that four states were seeking $1.4 trillion in penalties over accusations it designed its Facebook and Instagram platforms to addict young users and misled the public about their safety.
Meta had warned in April that legal and regulatory blowback in the European Union and the U.S. over youth social media issues "could significantly impact" its business and financial results.
Advertising remains central to Meta’s AI push
At the heart of Meta is its advertising business, with Reels battling TikTok and YouTube Shorts for dominance in the short-video market and Threads taking on Elon Musk's X, while AI powers more precise ad targeting and recommendation systems to boost user engagement.
