Meta building cloud business to sell excess AI capacity, Bloomberg News reports
Meta Platforms' Strategic Move into Cloud Computing
July 1 (Reuters) - Meta Platforms is building a cloud business to sell excess AI computing capacity, Bloomberg News reported on Wednesday citing people familiar with the matter.
Reducing Reliance on Advertising Revenue
The move could reduce Meta's reliance on advertising revenue and help it take on major cloud companies, including Amazon, Microsoft and Alphabet.
Market Reaction
Shares of the company were up nearly 6% in premarket trading.
Company Response
Meta did not immediately respond to a request for comment. Reuters could not independently verify the report.
Potential Offerings and Infrastructure Utilization
One option under consideration is offering customers access to AI models hosted on Meta's existing infrastructure, similar to Amazon Web Services' Bedrock platform, the report said.
CEO Mark Zuckerberg's Vision
Meta CEO Mark Zuckerberg had said earlier this year that the company could enter the cloud computing business if it overspends on data centers and has excess capacity.
Industry-Wide AI Infrastructure Spending
Big Tech firms are expected to spend more than $700 billion on AI infrastructure this year, up from around $400 billion in 2025.
Zuckerberg's Comments at Shareholder Meeting
"It's definitely on the table," Zuckerberg said at Meta's annual shareholder meeting in May, adding that "almost every week," other companies approached Meta asking it to sell them access to its AI models the way cloud providers do or looking to buy its spare computing capacity at a premium.
"We haven't done that yet, because we think that we have a use for the compute. But obviously, if we get to a point where we feel that we have overbuilt, then that is an option that we have, and that is partially what gives us confidence in investing in building this out."
Reporting Credits
(Reporting by Anhata Rooprai and Aditya Soni in Bengaluru; Editing by Jonathan Ananda)
