Meta Platforms Inc (NASDAQ:META) is evaluating plans to launch a cloud infrastructure business to sell access to artificial intelligence computing power and model access, according to a Bloomberg report published on Wednesday.
The report follows statements from Meta’s annual shareholder meeting, where CEO Mark Zuckerberg indicated potential enterprise opportunities.
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In a research note released on Thursday, BofA Securities analyst Justin Post maintained a Buy rating and an $835 price forecast on Meta, noting that enterprise sales could provide greater visibility into the value of the company’s AI capacity.
The Bull Case For AI Capacity Monetization
Zuckerberg indicated that the company can sell capacity at rates above the cost to build. According to Post, an infrastructure or model API business launch could underscore the underlying value of Meta’s capacity assets and model development.
“More broadly, Meta is building a strategically valuable asset at a time when global AI capacity remains scarce,” Post wrote. Wall Street expects Meta to incur a cumulative capital expenditure of approximately $850 billion between 2026 and 2030. Assuming an average cost of $45 billion per gigawatt (GW), this implies roughly 19GW of capacity.
If Meta monetizes 50% of this capacity externally at $10 billion to $15 billion in revenue per GW, it represents an incremental revenue potential between $100 billion and $150 billion.
The Bear Case and Structural Risks
A more cautious interpretation suggests that external compute leasing could serve as a fallback plan, raising questions about whether internal use cases for the added capacity are developing according to plan.
Post highlighted a structural disconnect regarding Meta actively leasing capacity from neocloud providers while potentially reselling its own capacity, noting questions regarding margins. Additionally, building an enterprise compute business without an established scale, chip cost, or model advantage could result in a low-margin business, similar to the multi-year timelines Amazon and Google faced to achieve breakeven cloud operations.
BofA Securities also flagged risks that Meta might increase investments to build the infrastructure business or reset expectations during the second-quarter earnings call.
Why Is Meta Falling on Thursday?
Meta stock fell roughly 4% on Thursday morning due to investor anxiety over massive projected capital expenditures required for its newly rumored AI cloud computing business, alongside natural profit-taking following an 8.8% surge the previous day.
META Stock Price Activity: Meta Platforms shares were down 4.30% at $586.53 at the time of publication on Thursday, according to Benzinga Pro data.
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