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By Jaspreet Singh
(Reuters) -Meta Platforms plans to spend as much as $65 billion this year to expand its AI infrastructure, CEO Mark Zuckerberg said on Friday, aiming to bolster the company's position against rivals OpenAI and Google in the race to dominate the technology.
As part of the investment, Meta will ramp up hiring for artificial intelligence roles and build a more than 2-gigawatt data center that would be large enough to cover a significant part of Manhattan.
The company — among the top buyers of Nvidia's sought-after AI chips — aims to end the year with over 1.3 million graphics processors and plans to bring about 1 GW of computing power online in 2025.
"This will be a defining year for AI," Zuckerberg said in a Facebook post. "This is a massive effort, and over the coming years it will drive our core products and business."
Big technology firms have been investing tens of billions of dollars to develop AI infrastructure after the success of OpenAI's ChatGPT.
Meta's announcement comes just days after U.S. President Donald Trump announced that OpenAI, SoftBank and Oracle will form a venture called Stargate and invest $500 billion in AI infrastructure across the U.S.
Earlier this month, Microsoft said it was planning to invest about $80 billion in fiscal 2025 to develop data centers, while Amazon.com has said its 2025 spending would be higher than an estimated $75 billion in 2024.
"Zuckerberg is signaling to the market he does not want to be second in the AI race. The timing of the announcement was likely impacted by Stargate, which created urgency around sending a message," D.A. Davidson analyst Gil Luria said.
Shares of Meta were trading 1% higher.
The company has emerged as a big player in the AI race with its AI chatbot, Ray-Ban smart glasses and open-source approach, which sets it apart from rivals by allowing consumers and most businesses to use its Llama AI models for free.
Zuckerberg expects Meta's AI assistant — available across its services — to serve more than 1 billion people in 2025, up from around 600 million monthly active users it had last year.
The $60 billion to $65 billion capital spending outlined for 2025 would mark a significant jump from the company's estimated expenditure of $38 billion to $40 billion for last year. It is also above analysts' estimate of $50.25 billion in 2025, according to LSEG data.
Meta is set to report its fourth-quarter results on Jan. 29.
(Reporting by Jaspreet Singh in Bengaluru; Editing by Shilpi Majumdar)
