The AI trade is increasingly being written in pink slips. Some of the most valuable blue chips, such as Nike (NKE), and Amazon (AMZN), are cutting jobs and redirecting cash toward AI systems, chips, and infrastructure, turning job cuts into part of a new efficiency playbook the market seems willing to buy.
Meta Platforms (META) now sits squarely in those crosshairs. Starting today, May 20, the company is set to begin a multi-batch layoff program that will initially affect about 10% of its workforce, and CEO Mark Zuckerberg has already signaled that AI could drive more cuts later this year. That keeps Meta firmly in line with a wider 2026 trend rather than outside it.
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The timing matters for the stock as META closed at $605.06 today, down 8.51% year-to-date (YTD) and 5.21% over the past year.
www.barchart.com The pressure is mounting further as Meta also navigates regulatory battles, including challenging New Mexico’s $3.7 billion teen mental health proposal in social media addiction trial.
So as layoffs begin and Meta reshapes itself around AI, one question hangs over the company. Is this the start of a leaner and stronger next chapter, or a sign that the real cost of the AI pivot is only starting to show?
What’s Happening Inside Meta
Inside Meta, the multi-batch layoffs are part of a much bigger reset that stretches from robots to power. The company has agreed to buy Assured Robot Intelligence, a startup that builds AI systems for humanoid robots that can understand and respond to human behavior in complex settings.
That deal brings a specialist humanoid team into Meta’s Superintelligence Labs and Robotics Studio. The goal is to move closer to “physical AGI” and build humanoid machines that can handle a broad range of real-world tasks.
At the same time, management has raised its 2026 AI capital spending forecast to between $125 billion and $145 billion. Multi-year infrastructure commitments rose by about $107 billion in a single quarter, locking in cloud and data center capacity through 2027. That spending helped drive some of Meta’s strongest sales growth since 2021, with quarterly revenue rising more than 30% to about $56 billion.
Around this shift, Meta is also running into real-world limits. Beijing has ordered the company to unwind a more than $2 billion attempt to buy AI startup Manus, showing how political scrutiny can block parts of its deal pipeline. Additionally, regulators in Australia are moving to tax large platforms to help fund local newsrooms, adding another cost pressure around Meta’s core ad business.
Meta is responding by securing more chip supply through a major deal that will see Amazon (AMZN) provide in-house AI processors, while also looking into long-term energy options like space-based solar power as its electricity needs keep rising, with partners like Northrop Grumman Corporation (NOC).
Taken together, the company is cutting staff, buying robotics talent, locking in triple-digit billion-dollar AI spending, and testing new power and chip options.
What This Means for META Stock
Wall Street is largely treating the May 20 multi-batch layoffs as part of a longer-term growth and efficiency story, not as a warning sign. The consensus across 55 analyst opinions is “Strong Buy,” which shows how aligned the Street is on Meta’s long-term story, even with all the near-term noise around restructuring and job cuts. Meta’s average price target is $826.12, which means about 36.5% upside from their recent level.
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www.barchart.com That fits neatly with the bullish pitch from billionaire Bill Ackman. He recently explained why Pershing Square (PS) has built a large position in Meta, saying that every company is an AI company today and that Meta is one of the clearest ways to bet on that shift in public markets. In his view, Meta offers scaled exposure to AI-driven products, heavy infrastructure spending, and vast data across the world.
Conclusion
Meta’s latest reset is pretty stark. Thousands of roles are being cut so the company can put more money into AI, robotics, chips, and the huge power bill that comes with all of that. The market is mostly treating this as a high-stakes upgrade rather than a step back, and today’s price still assumes there is solid room for gains if the plan stays on track. As long as the company keeps posting strong revenue while running a much leaner payroll, that upward momentum looks likely to continue.
On the date of publication, Ebube Jones did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.
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