According to Business Insider, Meta’s CMO Alex Schultz defended the company’s aggressive AI spending at the Web Summit conference in Lisbon, calling it “aggressive, but not crazy.” Meta plans to spend up to $72 billion this year on AI infrastructure with even higher spending expected next year. CEO Mark Zuckerberg previously said he’d rather risk “misspending a couple of hundred billion dollars” than be late to superintelligence development. Schultz revealed Meta’s AI investments are already generating billions in revenue by improving advertising tools and content algorithms, with the company expected to reach around $200 billion in revenue this year. He specifically highlighted the new Vibes feed of AI-generated video content as representing “probably a large chunk of the future” for Meta.
Bubble or brilliant?
Here’s the thing – when you’re talking about numbers this big, it’s natural to wonder if we’re in another tech bubble. But Schultz makes a compelling point about historical context. Compared to the US railroad bubble of the late 19th century, current AI investment represents less than 1% of GDP versus 2-5% during earlier tech booms. That’s actually pretty conservative when you think about it. And Meta’s sitting on a $1.5 trillion market cap – they can afford to take some big swings.
Where the money actually goes
So what are they actually building with all that cash? The biggest impact Schultz mentioned is their content recommendation system. Basically, most time spent on Facebook and Instagram now involves “unconnected content” – stuff that isn’t from friends or pages you follow. Without that AI-powered pivot, he openly wondered how much smaller Meta would be today. That’s a pretty stark admission about how crucial AI has become to their core business. And it’s not just about keeping users engaged – it’s directly driving their advertising revenue, which is their entire business model.
Energy concerns and Vibes
Now about that Vibes feed everyone’s calling “AI slop” – Schultz isn’t worried about the environmental impact. “Vibes isn’t that big — it’s not draining lakes or using multiple nuclear power stations,” he said. I mean, that’s one way to measure success I suppose. But his broader point about energy is interesting – he thinks the AI wave is actually prompting productive conversations about nuclear safety and desalination. “In general, humanity has the ability to have a lot more abundance than it does,” he argued. It’s an optimistic take, but is it realistic when we’re talking about video-generation models that require exponentially more computing power?
The bigger picture
Look, whether you love or hate AI-generated content, Schultz’s perspective matters because he’s the one responsible for turning these massive investments into actual revenue. His comment about Western European Calvinism – that society sometimes acts like “doing nice things that are fun is not what life’s about” – reveals how Meta sees this whole AI push. They’re betting that people ultimately want more entertaining experiences, even if they’re AI-generated. And they’re willing to spend hundreds of billions to prove it. The question is whether users will actually stick around for the “fun” or if this really is just another tech bubble in the making.
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