Meta Platforms isn't letting up in its artificial-intelligence push. The latest news is that it will invest more than $50 billion in a Louisiana data center but J.P. Morgan analysts are still cautious on the stock.
Meta said Monday that it intends to increase the size of its data-center project in Northeast Louisiana to five gigawatts of compute capacity, meaning it will now cost more than $50 billion -- up from an estimated cost of $27 billion.
It's just one more signal that Meta CEO Mark Zuckerberg isn't ready to pull back on AI spending, despite concerns his company lags behind in cutting-edge models compared with the likes of ChatGPT-developer OpenAI or Claude maker Anthropic.
J.P. Morgan analyst Doug Anmuth reiterated a Neutral rating and $725 target price on Meta stock in a research note Monday. He argued a recent update to its Muse Spark AI model was encouraging but the company has yet to show evidence of wider adoption.
"We're optimistic on early signs of AI monetization beyond digital advertising, but much will depend on traction of Muse Spark 1.1 & the subsequent Watermelon, and whether Meta gains trust from developers & enterprises," Anmuth wrote.
Meta shares were down 0.6% at $665.47 in premarket trading but have risen 13% in the past month.
Meta wants to double its computing capacity to 14 gigawatts next year, according to a Reuters report last week. A typical one-gigawatt AI data center requires $38 billion in upfront capital expenditure according to analysis firm Epoch AI -- so Meta's reported plan would imply roughly $266 billion in capex.
The social-media company isn't bearing the full cost of the buildout. Private-credit manager Blue Owl Capital owns a major stake in the Louisiana project, which has attracted investors including BlackRock, according to The Wall Street Journal.
"Meta pays the full costs of the energy, water, and related infrastructure the [Louisiana] data center uses so consumers aren't paying the cost," Meta said in a blog post. "Meta's recent agreement with Entergy will fund seven new natural gas-fueled generating plants, three grid-scale batteries, nuclear updates, and other purchased power."
Write to Adam Clark at adam.clark@barrons.com
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July 13, 2026 08:34 ET (12:34 GMT)
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