Meta Platforms(US:META) Benzinga·2025-12-01 15:13Core Viewpoint - Meta Platforms Inc is experiencing a decline in stock price, attributed to its significant investments in AI, which some investors view as a temporary setback while others see as a long-term strategy for growth [1][2]. Group 1: Stock Performance - Meta's stock has fallen for four consecutive months, decreasing by 1.6% in November, yet it remains up over 9% year-over-year [1][2]. - The stock is currently well below its 52-week high of $796, facing relentless selling pressure [2]. Group 2: Capital Expenditure - Meta plans to increase its capital spending to between $70 billion and $72 billion for 2025, a significant rise from its 2024 budget [2]. - This increase in spending has raised concerns among investors about the sustainability of Meta's AI investments [2]. Group 3: Technical Analysis - A recent chart pattern indicates a potential reversal, with Meta printing a hammer-style monthly candle after reaching November lows, suggesting aggressive dip-buying [3]. - Historically, Meta has never recorded five consecutive months of stock price decline in its 13.5-year history, indicating a possible sentiment recovery [3]. Group 4: AI Market Dynamics - Meta is exploring a multi-year deal to rent Google TPUs, which could impact Nvidia's dominance in the AI accelerator market, where it currently holds 80% to 95% market share [4]. - A partial migration of AI workloads to Google could potentially reduce Nvidia's annual sales by up to 10% [5]. Group 5: Competitive Positioning - Despite the stock price decline, Meta is strengthening its AI capabilities, which may reshape the competitive landscape in the AI economy [6]. - If Meta successfully diversifies its chip supply chain, it could reduce dependency risks and enhance its position in the market [6]. Group 6: Long-term Outlook - The current stock price decline may be viewed as a painful but necessary phase, with the potential for significant gains if Meta's AI initiatives succeed by 2026-2027 [7].