Meta shares plummet near 10% after earnings, Google skyrockets

Meta shares plummeted nearly 10% at the opening of Wall Street on Thursday, April 30 marking a sharp contrast to Google-parent Alphabet, which saw its shares skyrocket by more than 6%.

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 The divergent performances highlight how investors are beginning to distinguish between the various “Big Tech” approaches to heavy artificial intelligence spending.

Google emerged as the clear winner of the quarterly reporting cycle, with investors applauding its successful pivot to AI and solid performance across its major divisions. The company reported a profit of $62.6 billion on revenue of nearly $110 billion, comfortably beating market expectations.

In contrast, Meta’s results sent tremors through the market as the social media giant announced a significant increase in expenses to fund its pursuit of “superintelligence.” The company’s projected capital spending—largely dedicated to data centers, was raised by $10 billion to a staggering new range of $125 billion to $145 billion. 

Unlike Google, Amazon, or Microsoft, which can offset AI costs by selling cloud services to clients, Meta’s AI investments currently lack a direct, immediate revenue stream.

The broader tech sector felt the weight of these AI-related concerns. Amazon and Microsoft both saw their shares fall by 2% and 3.7%, respectively, as investors questioned the timeline for returns on their massive infrastructure investments.

Despite these specific fluctuations, the overall market remained relatively stable: The Dow Jones Industrial Average rose 0.8% to approximately 49,241. The S&P 500 gained 0.2% to reach about 7,151. The Nasdaq Composite Index remained flat at around 24,665.

Meta has recently moved to rein in costs to support its AI goals, confirming last week that it would cut roughly 8,000 jobs and leave an additional 6,000 roles unfilled. However, with quarterly expenses hitting $33.4 billion, Wall Street remains wary of the sheer scale of the company’s spending.