Meta strikes $10 billion cloud deal with Google to boost AI push
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Meta has inked a cloud computing agreement with Google valued at more than $10 billion over six years, a source familiar with the deal confirmed to AFP on Thursday.
The arrangement, first reported by tech outlet The Information, will see Meta rely on Google’s data center servers, storage, networking, and other services.
The source noted that this is one of the largest deals in the 17-year history of Google’s cloud division.
Meta, however, declined to comment.
The partnership comes as Meta CEO Mark Zuckerberg ramps up investments in artificial intelligence. Zuckerberg has been aggressively hiring leading AI researchers from competitors such as OpenAI and Apple with lucrative offers, aiming to develop what he describes as “AI superintelligence.”
"I'm excited to build personal superintelligence for everyone in the world," Zuckerberg said during the company’s latest earnings call.
Meta’s expansion into AI is part of a broader race among major tech giants, all spending heavily to secure dominance in the field. Google Cloud’s parent company, Alphabet, reported its cloud business was on track to generate $50 billion this year.
Meanwhile, Meta has sharply increased its spending on AI infrastructure. The company’s capital expenditures surged to $17 billion in the second quarter alone, with projected spending for 2025 ranging between $66 billion and $72 billion.
Despite reporting strong quarterly financial results, analysts remain cautious about Meta’s long-term prospects. "A strong quarter won't shield Meta from questions concerning the company's future as it breathlessly tries to keep up in the AI race," said Emarketer analyst Minda Smiley.
In a recent post outlining Meta’s AI strategy, Zuckerberg indicated that the remainder of the decade would mark a transformative period for artificial intelligence, with the company’s top priority being to integrate AI into the lives of its users.