Meta Platforms Inc. is in discussions with Anthropic to lease its computing capacity, a move that could position Meta in competition with major cloud providers like Amazon, Microsoft, and Google. The potential deal, still in early stages, may be valued at up to $10 billion over two years, according to a report by The New York Times, although specifics remain speculative, a source told CNN.
Key Details
Meta has been investing heavily in its data center infrastructure to support its artificial intelligence (AI) initiatives, with planned capital expenditures between $125 billion and $145 billion this year, a significant increase from the previous year. In April, the company announced plans to lay off approximately 8,000 employees, or 10% of its workforce, partly to manage the costs associated with these investments.
Background
CEO Mark Zuckerberg has indicated that leasing out excess computing capacity is a viable option if Meta's own needs do not match its infrastructure buildout. At a recent shareholder meeting, he noted,
Almost every week there are different companies that come to us from outside asking us … if we have compute that they could buy from us at some premium to what we’ve bought it at.
Currently, demand for computing power is high as various companies seek to enhance their AI capabilities.
Should the deal proceed, it could bolster Meta's revenue streams while intensifying competition in the cloud computing sector. Companies in the tech industry, particularly those involved in AI development, may experience shifts in their operational strategies as they consider their own computing needs. Investors will watch for further developments in the negotiations between Meta and Anthropic, as well as Meta's upcoming earnings report for additional insights into its capital expenditure plans.