Meta’s AI Pivot Sparks Investor Anxiety as Key Researcher Departs

Meta Platforms finds itself navigating turbulent waters as its strategic shift toward artificial intelligence triggers significant market concerns. Since the company disclosed its third-quarter results in late October, its shares have plummeted approximately 16%, with no clear indication of when this downward trend might reverse. The core issue stems from CEO Mark Zuckerberg's decision to fundamentally restructure the company's AI operations, a move that has left investors questioning whether this ambitious transformation will ultimately prove successful.

Compounding the uncertainty surrounding Meta's AI strategy are growing regulatory challenges. A Reuters investigation published in early November uncovered internal documents suggesting Meta could generate roughly $16 billion during 2024—approximately 10% of its annual revenue—from advertisements promoting fraudulent schemes and prohibited products. The report indicated users might be viewing an estimated 15 billion "higher-risk" fraudulent ads daily.

The U.S. Securities and Exchange Commission has initiated an investigation into financial fraud advertisements appearing on Meta's platforms, potentially exposing the company to substantial penalties. While company spokesperson Matthew Tye characterized these figures as "a rough and overly broad estimate" and highlighted the removal of 134 million fraudulent advertisements in 2025 alone, the damage to investor confidence had already been done.

Simultaneously, Meta announced on November 10th that it will discontinue its Like and Comment buttons for external websites effective February 10, 2026. These social plugins, which have been available since 2010, have seen their relevance diminish considerably amid tightening data protection regulations and evolving user preferences.

Leadership Shakeup Signals Strategic Shift

The company's AI ambitions suffered a significant setback this Tuesday with the departure of Yann LeCun, Meta's Chief AI Scientist and one of the most influential figures in global artificial intelligence research. Industry sources described his exit as "inevitable" following Zuckerberg's decision to invest $14.3 billion to recruit Alexandr Wang, who will now spearhead a newly established "Superintelligence" division—a clear indicator of strategic redirection.

Meta is executing a radical transformation, moving away from long-term fundamental research toward accelerated product development. The objective is to position the company as a formidable competitor against OpenAI and Google. However, this transition comes at a cost. As Hyperbolic CTO Yuchen Jin observed, Zuckerberg's patience with LeCun's long-term research methodology "ran out" following OpenAI's successful launch of ChatGPT. Meta's own Llama-4 model failed to achieve comparable market impact.

Should investors sell immediately? Or is it worth buying Meta?

While LeCun's departure removes an internal critic who expressed skepticism about large language models as a pathway to artificial superintelligence, it raises serious questions about Meta's continued capacity for cutting-edge research when prioritizing aggressive commercialization.

Massive Capital Commitment Evokes Metaverse Concerns

Adding to investor apprehension, Zuckerberg revealed on November 7th that Meta plans to commit an astonishing $600 billion over the next three years toward U.S. data centers and AI personnel. This comes in addition to previously announced expenditures of $70 to $72 billion for 2025 alone—nearly double the $39 billion spent the previous year. Management has further indicated that 2026 will involve even higher costs.

These colossal figures have sent chills through the investment community, with memories still fresh of Zuckerberg's Metaverse venture, which consumed billions without delivering anticipated returns. Rather than instilling confidence, the $600 billion announcement has triggered renewed anxieties that Meta is embarking on another massive experiment, this time with potentially more severe consequences.

This concern persists despite strong operational performance in the third quarter. Revenue reached $51.24 billion, representing a 26% year-over-year increase and surpassing analyst expectations by $1.8 billion. However, operating margin contracted from 43% to 40% as costs surged 32%—significantly outpacing revenue growth.

Analyst Sentiment Remains Cautiously Positive

Despite the 16% stock decline, most market analysts maintain their support for Meta. The average price target stands at approximately $827, suggesting roughly 29% upside potential from the current level around $620. Experts who revised their projections following the Q3 results express even greater optimism, projecting the stock could reach $857 on average.

This maintained confidence rests on one crucial assumption: that Zuckerberg's massive AI investment will yield positive returns. The coming quarters will determine whether these billion-dollar commitments translate into sustainable competitive advantages or whether Meta is steering into another self-inflicted crisis.