Meta is falling after its latest earnings update, with the selloff centered on a bigger-than-expected increase in spending plans for 2026 as the company accelerates AI data-center and infrastructure buildouts. Investors are treating the higher capex trajectory as a near-term hit to profitability and free cash flow, especially alongside ongoing losses in the Reality Labs segment. (techcrunch.com)

Meta reported strong top-line performance and profitability in Q1, but the spending outlook dominated the market reaction. The company lifted its 2026 capital-expenditure forecast into roughly the $125B–$145B range (various recaps cite a midpoint around $135B), signaling a step-up in AI-related infrastructure intensity that investors worry could weigh on margins for longer than previously expected. (techcrunch.com)

Reality Labs again posted a large operating loss while generating comparatively small revenue, reinforcing concerns that Meta is funding multiple expensive bets at the same time—AI infrastructure and long-dated AR/VR initiatives. The persistence of sizable Reality Labs losses adds to the market’s sensitivity around any additional capex escalation. (techcrunch.com)

Focus is shifting to whether Meta can sustain ad-driven revenue growth while absorbing the higher AI buildout costs, and whether management provides clearer visibility on the pace of spending beyond 2026. Any evidence of decelerating revenue growth, weaker engagement metrics, or further capex increases could keep the stock volatile even if near-term results remain strong. (androidcentral.com)