Even Mark Zuckerberg seems surprised by Meta's pace of spending on AI

Meta has been so quick to build out its massive data center and computing infrastructure for artificial intelligence projects that CEO Mark Zuckerberg is even a bit surprised.

In a call with analysts on Wednesday after Meta's third-quarter earnings report, Zuckerberg explained to investors how Meta's rising costs for the year are tied to the speed at which employees are able to get data centers, servers and chips for AI up and running.

"Going into the year, we had a range for what we thought we could potentially do, and we've been able to do more than we've kind of hoped and expected at the beginning of the year," Zuckerberg said.

It also means investors have to buckle up for higher expenses. Meta raised the low end of its capital expenditures guidance for 2024 to $38 billion from $37 billion. The top end is still $40 billion.

"It's actually something that I'm quite happy that the team is executing well on," Zuckerberg said. "That execution makes me somewhat more optimistic that we're going to be able to keep on building this out at a good pace."

Meta added that the expenditures, which include purchases of billions of dollars worth of Nvidia's graphics processing units, will grow significantly in 2025.

Meta shares dipped in extended trading on Wednesday despite the company beating on earnings and revenue. Weaker-than-expected user growth was part of the concern, along with rising costs.

On the earnings call, Barclays analyst Ross Sandler asked Zuckerberg how quickly Meta can build the immense computing infrastructure needed to reach its goals around generative AI, given possible barriers like energy requirements and the time needed to develop its own custom AI-specific chips.

Zuckerberg responded by complimenting Meta's