Mike Green, the famous economist, dropped a blunt assessment of Meta Platforms in a November 2025 interview:
“Meta, which in particular is fighting for its life with a largely static and… increasingly irrelevant product mix… has basically come out and told you we would prefer to go bankrupt than miss this opportunity.”
He’s of course referring to Meta’s recent earnings report Where Zuckerberg didn’t mince words, saying that their spending on AI would be “notably larger” next year.
The Facebook and Instagram parent reported third-quarter revenue growth of 26% that beat market estimates, but that was overshadowed by a 32% increase in spending.
Zuckerberg effectively said: this level of spending will not slow down.
The earnings call made it painfully obvious that Meta sees its future not as a steady compounder of ad revenue anymore, but as a firm that must build a new technological identity, because the old one is losing relevance:
- Facebook user base is aging
- WhatsApp still has weak monetization
- Ad targeting is under attack from privacy changes
- Product innovation continues to be incremental, not transformational
- AI is threatening Meta’s product mix
But How Does AI Threaten Meta?
Meta’s entire model depends on owning time. If users spend less time scrolling Instagram or Facebook, Meta sells fewer impressions.
People now spend meaningful time:
- chatting with AI
- using AI as companions
- asking AI for recommendations
- using AI to plan travel, events, purchases
- generating AI content
- using AI apps as entertainment
Every minute spent in ChatGPT, Claude, Gemini, Grok or any other AI agent is a minute not spent on Meta platforms.
Meta’s Current Valuation Problem
Meta has to spend aggressively not because their business is strong, but because the valuation tells them they must become something bigger than they currently are.
The market is sending them a message:
“We value you like an AI platform, not a commoditized ad company.”
Zuckerberg’s capital allocation is the reply:
“Fine. If that’s what you’re paying for, then we will build that story at any cost.”
The stock price creates expectations, and those expectations force them to increase spending.
If Meta were valued cheaply they might be far more disciplined. But when a company is:
- trading at a premium,
- treated like a top-tier AI beneficiary,
they have no choice but to play the part.
If they do not invest aggressively in AI, their multiple collapses.
Meta is spending at a level that only makes sense if management believes their valuation is at risk.
There’s a scenario where Meta not only survives the AI transition, but emerges as one of the two or three most powerful companies on the planet by 2030, but the stock is no longer the stable ad compounder it once was. It’s effectively a high-risk AI transformation story priced like a proven winner. In other words: the stock can keep rising, but the safety of owning it long-term has never been lower.