Meta AI bets and legal costs slash free cash flow
Meta (yep, the company behind Facebook and Instagram) is having a rough quarter.
Its big bets on artificial intelligence and mounting legal costs have slashed its free cash flow from $8.55 billion last year to just $784 million now, indicating that full-year revenue will likely come in below market expectations.
Mark Zuckerberg backs AI plans
Even with money troubles, CEO Mark Zuckerberg is sticking to his AI vision; he's excited about smarter ad algorithms and teased upcoming products like Meta glasses and always-on personal agents.
Meanwhile, Meta spent $2.4 billion on legal charges, as it faces a barrage of lawsuits, most of which allege its platforms harm children's mental health, with potential damages threatening to match the company's entire market value.
Investors worry about Meta outlook
But recent earnings and legal headaches have investors wondering what comes next.