Shares of Meta Platforms Inc. experienced a modest decline in Thursday's morning trading session, shedding nearly 1% to hover around $662.15. The dip coincides with heightened investor scrutiny of the technology giant's escalating capital commitments to artificial intelligence infrastructure, a strategic pivot that is reshaping its financial profile.
Major Indiana Data Center Project Breaks Ground
This week, Meta commenced construction on a massive new data center campus in Lebanon, Indiana, representing a planned investment of $10 billion. The facility is designed to deliver 1 gigawatt of capacity, a substantial amount of power roughly equivalent to the needs of 800,000 households. Company executives, including Vice President of Data Centers Rachel Peterson, emphasized an aggressive construction timeline, targeting operational status by late 2027 or early 2028. The project is expected to create over 4,000 construction jobs at its peak, with approximately 300 permanent positions once operational.
In line with its sustainability pledges, Meta stated the Indiana campus will aim to offset its entire energy consumption with renewable sources, pursue LEED Gold environmental certification, and implement a closed-loop cooling system designed to minimize water usage for most of the year. The company has also noted it works directly with utilities to manage grid impact. This project is part of a broader buildout, with a second Indiana site reportedly planned for Jeffersonville.
Bill Ackman's Pershing Square Discloses Major Stake
Adding a significant layer of market context, billionaire investor Bill Ackman’s hedge fund, Pershing Square, disclosed it established a substantial position in Meta during the latter part of the previous year. The stake is valued at approximately $2 billion, constituting about 10% of the fund's total capital. In communications to clients, Pershing Square expressed a bullish long-term view, asserting that Meta's current share price fails to fully reflect the upside potential from its AI investments. However, the fund concurrently acknowledged prevailing investor unease regarding the scale of the company's spending in this arena.
According to reports, Pershing Square began accumulating shares in November at an average price of $625 each. The disclosure comes after a period of stock price softness for Meta, which closed at $669 on February 11, driven largely by concerns over its aggressive expenditure plans.
Capital Expenditure Forecasts Signal Steep Climb
Meta's financial disclosures quantify the ambitious spending trajectory. For the 2025 fiscal year, the company reported capital expenditures—covering data centers, servers, and finance lease payments—of $72.22 billion. Looking forward, management has forecast a significant jump, anticipating capex to reach a range of $115 billion to $135 billion in 2026. This projected increase is attributed directly to accelerated investments in AI infrastructure and core business enhancements.
The scale of this planned spending presents a clear risk-reward calculation for the market. While the potential long-term benefits of AI leadership are considerable, the upfront costs are substantial, and the timeline for returns remains uncertain. Investors are wary of scenarios where a downturn in advertising demand or unexpected spikes in construction, semiconductor, or energy costs could exacerbate pressure on profitability and refocus attention on the capex burden.
Local community engagement has also emerged as a point of discussion. As Meta's plans move from blueprint to reality, officials in Indiana have sought more detailed information on resource use—specifically water and power—and the promised community benefits. Company leadership has reiterated a commitment to being a positive force in its host communities.
Market participants are now looking ahead to broader economic indicators for direction. The release of the U.S. Consumer Price Index data for January, scheduled for Friday, February 13, is highly anticipated. The inflation reading has the potential to swiftly alter interest rate expectations and, by extension, valuation models for mega-cap technology stocks like Meta.
