Meta's stock jumped nearly 3% in premarket trading Thursday after announcing plans to slash its workforce by over 20% while doubling down on a staggering AI spending spree. If that sounds backwards to you, welcome to Wall Street's new playbook: fire people, buy GPUs, watch your stock price soar.
The Big Picture
Meta is planning sweeping layoffs to offset what the company calls "increased AI spending" this year. The cuts could eliminate more than one in five jobs at the social media giant, according to Reuters. Meanwhile, the company just announced a 5-year, $27 billion deal with Nebius to build out AI infrastructure, including $12 billion in dedicated capacity using NVIDIA's Vera Rubin chips starting early 2027.
Let's be clear: Meta's AI spending isn't just big, it's absurd. The company is committing up to $600 billion for data centers by 2028, per the Reuters report. That's more than the GDP of Sweden. And to pay for it, tens of thousands of people are about to lose their jobs.
Wall Street's Twisted Logic
Here's what makes this story so frustrating: the market loves it. Meta's stock rose on the news because investors see efficiency. They see margins expanding. They see a company "getting lean" to fund the future.
But if you're one of the 20% getting a severance package, you're not seeing efficiency. You're seeing your mortgage payment disappearing because Mark Zuckerberg wants to spend half a trillion dollars on a technology that—let's be honest—still hasn't proven it can generate returns anywhere close to these costs.
Meta isn't alone here. Amazon eliminated 16,000 roles in January, citing the need to "reduce layers and bureaucracy" while it invests heavily in AI. So far in 2026, AI has been cited in over in the U.S., according to consulting firm .
