Meta Stock Slumps on Goldman Sachs' AI Spending Warning

Meta's stock took a hit on September 25, plummeting around 4% as investors got spooked by Goldman Sachs' warning that $800 billion in AI infrastructure spending in 2026 may not generate sufficient returns. The bank estimates that breaking even would require around $300 billion in annual AI-services revenue across the sector, while generating strong profits could demand a staggering $1 trillion annually.

Meta's own numbers illustrate the tension between its massive capital expenditures and dwindling free cash flow. In the second quarter, it spent approximately $31.1 billion on physical assets such as servers and data-center buildings, while its free cash flow compressed to around $784 million for the same period. For 2026, Meta has guided towards $130 billion to $145 billion in capital spending, nearly twice what it deployed in 2025.

The share-price drop translated directly into a change in Mark Zuckerberg's estimated paper wealth, meaning the market value of his equity stake, not cash in an account. Forbes reported that his net worth dropped by nearly $9 billion, bringing it to around $257.5 billion.