- Meta plans to spend between $60B–$65B on data centers in 2025, a significant increase from last year’s $38B–$40B.
- A major portion will be allocated to expanding and building new data centers, primarily aimed at supporting the company’s growing AI needs.
- Meta’s planned $4.3B restructuring charge in 2023 reflects the company’s pivot to accommodate AI in its data center designs.
Mark Zuckerberg is doubling down on Meta’s (META) infrastructure as the tech giant targets a record $60B to $65B in capital expenditures for 2025, up from last year’s $38B to $40B spend.
According to The Real Deal, the lion’s share of this investment will go to building and expanding data centers to support Meta’s rapidly growing AI capabilities.
Massive AI Investment
With billions on the line, the competition for data center dominance is intensifying. As data centers become the backbone of AI, Meta is pushing to keep pace with rivals like Microsoft (MSFT), Amazon (AMZN), and the newly formed Stargate, a JV involving OpenAI, Oracle (ORCL), and SoftBank.
Meta’s massive data center investment is designed to support its AI initiatives, which are central to its future strategy. Last year, Meta already adjusted its infrastructure to accommodate the computing power required by its AI algorithms, incurring a $4.3B restructuring charge. This year, the company is betting even bigger on AI, with its data center plans expected to ramp up dramatically.
In fact, Meta has already announced a 4 MSF data center in Richland Parish, LA, set to fuel its computing needs, as well as a massive $800M facility in Central Texas.
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Global Data Center Race
Meta is not alone in the data center race. Microsoft is also heavily investing in data centers, with a planned $80B spend this year, more than half of which will be used for US-based developments. Meanwhile, Amazon has focused on industrial acquisitions, including data centers, spending over $2B in 2024, over 2x the $920M the e-commerce giant spent in 2023.
On top of that, the tech sector is facing mounting pressure to balance expansion with sustainability. Data centers consume massive amounts of energy, which leads to both logistical and political challenges for companies and local communities alike.
Environmental Challenges
While giant data centers promise powerful computing capabilities, they also have serious environmental and social costs.
Unsurprisingly, communities near data centers often have mixed reactions, as residents and local governments weigh the economic benefits against the environmental and social consequences.
Moreover, the massive scale of these projects raises questions about land use, sustainability, and how companies can mitigate the environmental impact of growing data footprints.
The Road Ahead
Meta’s investment in data centers is a clear sign the company is preparing for the next phase of AI evolution. But Meta’s push comes amid fierce competition, as other tech giants race to build their own AI infrastructure.
However, with the risks of environmental impact and energy consumption in play, these data center projects will need to find sustainable solutions to ensure they don’t undermine the very technology they aim to support.nt market,” said Ledom. “Its affordability, rapid in-migration, and improving rent growth outlook offer compelling opportunities for multifamily investors.”
