AI trading is increasingly written in pink slips. Some of the most important blue chips, such as Nike (NKE), and Amazon (AMZN), are cutting jobs and redirecting money to AI systems, chips, and infrastructure, turning job cuts into part of a new efficiency playbook that the market seems willing to buy.
Meta Platforms (META) now sits squarely on those crosses. Starting today, May 20, the company will begin a mass layoff program that will affect about 10% of its workforce, and CEO Mark Zuckerberg has already signaled that AI could drive more cuts later this year. That keeps the Meta firmly in line with the broader 2026 trend rather than outside of it.
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It’s an important time for the stock as META closed at $605.06 today, down 8.51% year to date (YTD) and 5.21% over the past year.
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The pressure is mounting as Meta also navigates regulatory battles, including challenging New Mexico’s $3.7 billion youth mental health proposal on social media addiction testing.
So as layoffs begin and Meta reshapes itself around AI, one question hangs over the company. Is this the start of the next leaner and stronger chapter, or a sign that the true costs of the AI pivot are beginning to show?
What’s Happening Inside the Meta
Within the Meta, the dismantling of many factions is part of a larger reset from robots to power. The company has agreed to buy Assured Robot Intelligence, a startup that builds AI systems for humanoid robots that can understand and respond to human behavior in complex environments.
That deal brings a special humanoid team to Meta’s Superintelligence Labs and Robotics Studio. The goal is to approach “physical AGI” and build humanoid machines that can handle a wide range of real-world tasks.
At the same time, executives raised their 2026 AI capital spending forecast to between $125 billion and $145 billion. Multi-year infrastructure commitments increased by nearly $107 billion in one quarter, covering cloud and data center capacity by 2027. That spending helped drive Meta’s strong sales growth through 2021, with quarterly revenue up more than 30% to nearly $56 billion.
With this change, Meta also runs into the limits of the real world. Beijing has ordered the company to shelve a more than $2 billion bid to buy AI startup Manus, showing how political scrutiny can block parts of its deal pipeline. Additionally, regulators in Australia are moving to larger tax havens to help fund local newsrooms, adding further cost pressure around Meta’s core ad business.
Meta is responding by acquiring more chip supplies in a major deal that will see Amazon ( AMZN ) provide in-house AI processors, while looking at long-term energy options such as space-based solar power as its electricity needs continue to rise, with partners such as Northrop Grumman Corporation ( NOC ).
Taken together, the company is cutting staff, buying robotics talent, capping triple-digit billion-dollar AI spending, and exploring new capabilities and chip options.
What This Means for META Stock
Wall Street is treating the May 20 layoffs more as part of a long-term story of growth and efficiency, not as a warning sign. The consensus across all 55 analyst opinions is “Strong Buy,” which shows how aligned the Street is to Meta’s long-term story, even with all the recent noise about restructuring and job cuts. The average target price for Meta is $826.12, which means about 36.5% upside from their recent level.
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That fits well with the bullish pitch from billionaire Bill Ackman. He recently explained why Pershing Square (PS) built a large position in Meta, saying that every company is an AI company today and that Meta is one of the clearest ways to bet on that change in the public markets. In his view, Meta offers limited exposure to AI-driven products, strong infrastructure spending, and global big data.
The conclusion
Meta’s latest reset is very prominent. Thousands of roles are being cut so the company can invest more in AI, robots, chips, and the huge energy bill that comes with all that. The market mostly sees this as a bullish development rather than a reversal, and today’s price still assumes that there is solid room for gains if the plan remains on track. As long as the company continues to post strong earnings while running on reduced earnings, that upward momentum looks set to continue.
At the date of publication, Ebube Jones did not have (directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is for informational purposes only. This article was originally published on Barchart.com
