On Wednesday, Meta Platforms, Inc. (NASDAQ:META) shares surged 8.81% after a report said the company is developing a cloud computing business aimed at monetizing its vast artificial intelligence infrastructure, prompting Jim Cramer to argue the initiative could add significant value to the stock.
Meta’s AI Compute Strategy Sparks Investor Optimism
Meta’s stock climbed after a report revealed the company is building an internal initiative known as Meta Compute, which would allow it to generate revenue from excess AI computing capacity.
According to the report, Meta is exploring two offerings. The first would let developers access AI models hosted on Meta’s infrastructure, similar to Amazon.com, Inc.’s (NASDAQ:AMZN) Web Services’ Bedrock platform.
The second would involve selling raw computing capacity to businesses, putting Meta in competition with AI-focused cloud providers such as CoreWeave Inc. (NASDAQ:CRWV).
The move could help offset the company’s massive investments in AI infrastructure as demand for graphics processing units and computing power continues to outpace supply.
Jim Cramer Calls Move ‘Worth $100’ Per Share
Reacting to the news, CNBC’s Cramer doubled down on his bullish view of Meta.
“I reiterate what I have been telling club members. This Meta news is worth $100,” he wrote on X.
In a separate post, Cramer questioned why the market reaction was not even stronger.
“I find it difficult to believe that Meta was up only 49 points when it is getting into the most lucrative game, business-to-business at 18x eps????”
Meta shares closed Wednesday at $612.91, up $49.62, or 8.81% and declined 0.13% to $612.10 in after-hours trading, according to Benzinga Pro.
Analysts See AI Compute Monetization As Strategic Move
Futurum Group CEO Daniel Newman also welcomed the development, pushing back against investors who sold shares of Nebius Group NV (NASDAQ:NBIS) and Cipher Digital Inc (NASDAQ:CIFR).
“$META setting itself up to offer compute services is not an indicator of abundance. It’s a smart business move that allows it to invest ferociously while mitigating risk and offsetting expense as it increases consumption and monetization,” Newman wrote.
Nebius shares closed Wednesday at $229.18, down 17.01%, while Cipher closed at $22.84, down 6.78%.
Meta told investors in April that it expects to spend as much as $145 billion on capital expenditures this year as it continues expanding data centers and acquiring AI chips to support its growing artificial intelligence ambitions.
According to Benzinga Edge Rankings, Meta scores in the 88th percentile for growth, although the stock has delivered negative returns across the short, medium and long term.
Disclaimer: This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.
Photo courtesy: katz / Shutterstock.com
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