Meta and Microsoft Stocks Decline Amid High AI Spending

Several major technology firms are facing investor skepticism in 2026 as high capital expenditures for artificial intelligence weigh on stock prices. Meta Platforms has seen its stock decline by approximately 12%, driven by bearish sentiment regarding the perceived collapse of the metaverse and heavy spending on AI infrastructure. To pivot toward AI and neocloud services, Meta plans capital expenditures between 115 billion and 135 billion dollars for the year, even as its core advertising business grew 33 percent year-over-year in the first quarter.

Microsoft has underperformed more significantly, with its stock falling nearly 20 percent. Despite this, the company reports strong fundamentals, including a 40 percent year-over-year growth in its Azure cloud division and 37 billion dollars in annual revenue from its Copilot business.

Other sector players show mixed results. Oracle is transitioning into an AI infrastructure provider with a 638 billion dollar backlog, but its shares have dropped nearly half due to investor concerns over the financial stability of its partner, OpenAI. Meanwhile, The Trade Desk has experienced a deceleration in revenue growth to 12 percent as customers resist its AI-driven Kokai platform. OpenAI remains a central figure in the sector's volatility, with rumors circulating that the company is preparing for an initial public offering potentially valued at over 1 trillion dollars.