Zuckerberg has hinted for months that selling compute was on the table.
Meta shares jumped nearly 9% this week after a report revealed the social media giant is considering getting into the business of selling cloud computing and AI model access, a move that sent shockwaves through the young but fast-growing Neocloud industry.
Why Meta stock took off
According to a Bloomberg report, Meta is building a new business to sell some of the massive computing capacity it has accumulated through years of heavy investment in data centers and AI chips. The plan reportedly includes two main paths. First, Meta could sell outside developers access to AI models, including its own Muse Spark models, similar to how Amazon lets customers tap into various AI systems through its Bedrock service. Second, the company is said to be weighing whether to sell its excess raw computing power directly to other companies. Meta did not comment on the report, though CEO Mark Zuckerberg had already signaled the idea was under consideration.
Rival cloud stocks take a hit
The news rattled investors in companies that specialize in renting out AI computing power. CoreWeave shares dropped nearly 14% following the report, while Nebius, a fast-growing AI-focused cloud provider, fell 17%. Bernstein analyst Madison Rezaei said Meta’s enormous data center footprint means it could easily compete with existing cloud providers, estimating the company already controls roughly 20 gigawatts of capacity worldwide with another 14 gigawatts expected to come online in the coming years.
Zuckerberg has hinted at this for months
Zuckerberg told investors back in May that selling compute was something the company was actively considering, noting that outside companies regularly approach Meta asking to buy access to its computing power at a markup. He explained that Meta has held off so far because it still sees plenty of internal uses for its computing capacity, but said that could change if the company ever felt it had built more than it needs.
Why the strategy makes sense for Meta
Industry analysts note that Meta’s aggressive data center construction gives it multiple ways to profit from its investment even if its most ambitious AI research goals fall short. The company has reportedly signed deals for more than 5 gigawatts of new cloud and data center capacity in just the first half of this year alone, on top of its own rapidly expanding self-built facilities. Beyond selling raw compute, analysts believe Meta could strike a deal to offer paid access to Anthropic’s Claude models, potentially generating billions of dollars in new revenue while also fueling growth in its advertising business, which increasingly relies on AI to power recommendation systems.
For now, Meta has yet to confirm any formal plans, but Wall Street’s reaction suggests investors think the shift could be significant.
Disclaimer: This article is for informational purposes only and does not constitute financial advice. The author and publication are not registered investment advisors and do not provide personalized investment recommendations.