AI investment

Venture capitalist Joe Lonsdale argues that leading AI companies are understating the capital and energy resources needed to realize their ambitions, potentially misleading investors. He believes this underestimation necessitates frequent capital raises. Lonsdale’s comments come amidst an AI investment surge and warnings of a potential bubble. He suggests current spending is being underestimated and favors AI applications demonstrating clear economic value, questioning the long-term sustainability of the current AI investment trajectory.

Jim Cramer’s “Investing Club” is upgrading Meta Platforms to a buy-equivalent rating despite a recent stock dip following earnings. While Meta’s increased AI investments sparked investor concern, Cramer believes the long-term potential outweighs the short-term anxieties. He highlights that these investments will enhance Meta’s video capabilities, benefiting advertisers and driving user engagement. The upgrade follows strong quarterly revenue and EPS, coupled with raised revenue guidance. While acknowledging spending concerns, Cramer emphasizes Zuckerberg’s aggressive approach and Meta’s ability to reallocate computing power, making the dip a strategic entry point.

Wall Street saw mixed trading, pressured by Meta and Microsoft’s AI spending concerns despite strong earnings. Honeywell spun off Solstice Advanced Materials (SOLS), receiving an “outperform” rating from BMO. DuPont is set to separate Qnity Electronics (“Q”). Goldman Sachs CEO David Solomon remains confident despite stock performance, citing strong global banking and markets division performance. He sees a low recession risk and AI infrastructure investment as an economic tailwind. Investors await earnings reports from Apple, Amazon, Cloudflare, and Linde.

San Francisco Mayor Daniel Lurie faces daily pressure to improve the city’s safety and economy. Following President Trump’s reversal of a federal surge plan, Lurie emphasizes San Francisco’s progress, citing data on business development and crime reduction. He highlights the AI sector’s impact, with venture funding surpassing 2021 levels. Crime rates are down, and tourism is up. The city is focused on attracting investment and fostering a broad-based recovery by removing red tape. He aims to support both tech companies and small businesses.

Meta’s Q3 earnings beat expectations with $7.25 EPS and $51.24 billion revenue, driven by strong ad sales and user growth. However, shares dipped due to a $15.93 billion tax charge related to new legislation. The company anticipates long-term tax benefits from this. Meta projects Q4 revenue between $56-59 billion but increased its full-year expense guidance to $116-118 billion, reflecting AI infrastructure investments. Reality Labs reported a $4.4 billion loss. The company highlighted the success of AI-powered glasses and increasing AI adoption.

Meta (META) shares were volatile after Q3 results, despite exceeding revenue expectations with a 26% YoY increase to $51.24B. While EPS beat estimates, a $16B tax charge and increased capex guidance for AI investments in 2026 concerned investors. Meta emphasized the strategic importance of AI for advertising and future opportunities, citing strong user engagement and monetization. Q4 revenue is projected at $56B-$59B, with increased spending expected.

Meta is restructuring its AI division, laying off approximately 600 employees. This aims to improve operational agility amid fierce competition with companies like OpenAI and Google. Despite the layoffs, Meta continues to invest heavily in AI infrastructure, including the $27 billion “Hyperion” data center. The move may signal a focus shift towards commercially viable AI applications and a prioritization of applied AI research. The restructuring’s success will impact Meta’s long-term AI competitiveness and metaverse ambitions.

Salesforce is investing $15 billion over five years to advance AI and support its San Francisco headquarters. The investment includes an AI incubator and the “Agentforce 360” platform for AI-powered digital assistants. CEO Marc Benioff emphasizes the commitment to innovation and job creation. This move occurs before Dreamforce, expected to generate $130 million for San Francisco. Salesforce also plans a $1 billion investment in Mexico. Analyst Dan Romanoff sees the AI investment as vital for maintaining a competitive edge in a talent-scarce market.

Alibaba’s Hong Kong shares surged to 2021 highs after announcing increased AI investment and new AI product updates. Shares jumped over 6%, boosting year-to-date gains above 107%. CEO Eddie Wu revealed plans to increase spending on AI models and infrastructure on top of the existing 380 billion yuan investment. Alibaba unveiled the Qwen3-Max large language model and updates to its AI portfolio, emphasizing its position as a full-stack AI service provider. Wu projected over $4 trillion global AI investment in the next five years, highlighting Alibaba’s strategic AI pivot.

Google is investing £5 billion ($6.8 billion) to boost the UK’s AI infrastructure, including a new data center near London to support its AI-driven services. This investment, coinciding with President Trump’s UK visit, is expected to create 8,250 jobs annually and contribute significantly to the UK economy. The strategy involves DeepMind’s AI research and a collaboration with Shell for renewable energy supply, aligning with the UK’s sustainability goals. Alphabet anticipates AI to add £400 billion to the UK economy by 2030.