MENLO PARK — Meta Platforms shares surged as much as 8% on Wednesday following a Bloomberg News report that the tech giant is building a cloud business to sell its excess AI computing capacity to external customers — setting up direct competition with Amazon Web Services, Microsoft Azure, and Google Cloud.
According to sources familiar with the matter, the initiative is developing under an internal segment called Meta Compute. Meta is exploring a dual-pronged approach to monetize its massive infrastructure investments:
- Model-as-a-Service: Selling access to various AI models hosted on Meta's infrastructure — such as its Muse Spark models — similar to AWS's Bedrock offering. - Raw Compute Infrastructure: Selling access to bare-metal computing capacity, positioning itself against emerging "neocloud" providers like CoreWeave.
The move addresses long-standing investor concerns about Meta's aggressive capital expenditures. "Since the industry in aggregate still seems to be capacity constrained, this Meta compute infrastructure will likely be quickly utilized by others," said Adam Crisafulli, analyst at Vital Knowledge.
However, some analysts interpreted the pivot as a tacit admission that Meta overbuilt capacity. The news weighed heavily on neocloud stocks, with CoreWeave and other data center suppliers slipping as a major new competitor entered the arena.
