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Meta plans to sell AI compute to other firms in neocloud push
The shift follows investor pressure over Meta’s AI spending, and analysts say selling compute is partly aimed at addressing doubts about near-term returns.
Facing investor skepticism about its AI spending, Meta is moving toward the neocloud business model, with plans to offer some of its computing capacity to other large AI firms, according to Bisnow.
In late July, CEO Mark Zuckerberg outlined on Meta’s earnings call that the company will begin “selling compute directly,” describing the move as a market opportunity driven by insufficient industry-wide compute, noting it has received a large number of offers for the capacity it has.
Bisnow reports that Meta has invested hundreds of billions of dollars in AI build-out and developed two of the first gigawatt-scale computing campuses in Ohio and Louisiana, but until recently the firm largely focused on using that capacity for its own AI ambitions, including advertising and recommendation systems across Facebook, Instagram and WhatsApp, rather than serving external cloud customers.
Industry analysts cited by Bisnow suggest Meta’s decision comes amid growing Wall Street anxiety that Big Tech’s AI capital expenditures are not translating into commensurate returns, particularly after second-quarter results led investors to penalize companies that increased AI capex without a clear path to profitability, and the outlet notes Meta lacks the same kind of sales backlog Big Tech cloud providers can show.