Mark Zuckerberg's Meta Saw Free Cash Flow Plunge 91% to Just $784 Million as AI Spending Ballooned. Here's Why That Should Worry Investors.
Meta Platforms' revenue growth is accelerating thanks in part to its AI efforts, but the scale of its infrastructure spending is increasing its long-term financial risk.
Overview
Meta Platforms' (NASDAQ: META) second-quarter numbers tell a strange story: The business itself is booming, but so much of its cash flow is being consumed by its AI build-out that there's little left over.
Free cash flow fell 91% year over year to just $784 million, even as revenue jumped and operating cash flow exceeded $31 billion. That combination should make long-term investors pause.
Details
Meta reported Q2 revenue of about $60.8 billion, up 28%, with advertising sales rising 27% as AI tools improved ad targeting and content recommendations. Operating cash flow grew 25% to $31.86 billion, which is exactly what you want to see from a strong platform business.
Source
Originally published at www.fool.com.
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