Meta's CEO, Mark Zuckerberg, has identified a potential new growth path by leveraging the company's excess compute capacity. During the latest earnings call, he reiterated a strategy first outlined during the May 2026 shareholder meeting. Meta has taken its first step in this direction by securing a 1-gigawatt data center partnership with BlackRock in Texas, showcasing its commitment to entering the cloud space.
At the end of the previous quarter, Meta held $226 billion in net property and equipment, a figure that includes the cost of its extensive data center network. Zuckerberg highlighted that the company is currently getting offers for its unused compute resources at a significant premium over the cost it paid to acquire them. These offers could lead to strong returns on the company’s substantial investments in data centers.
What This Could Mean for Meta
If Meta can monetize even a fraction of its excess computing power, it could potentially generate revenue in the tens of billions each year. This could place Meta’s cloud operations just behind Google Cloud, which reported $99 billion in revenue last quarter. However, the company would still remain in second place compared to market leaders like Microsoft and Amazon, both of which surpassed $100 billion in cloud revenue during the same period.
According to Goldman Sachs, major cloud providers are expected to invest over $5 trillion in data centers and related technologies by 2030. This investment could open the door for Meta to build a new revenue source beyond its current reliance on advertising. A shift away from ad-driven income could make the company more attractive to investors and justify a higher valuation. Meta’s current multiple of 17 times forward earnings is considered relatively low given its potential.
However, the cloud computing market is highly competitive. Google Cloud, for example, has a comprehensive stack of chips, software, and AI models — elements that Meta has yet to fully develop. Despite significant investments, Meta’s cloud business may face challenges in catching up to the industry leaders. The cloud segment remains a small part of Meta’s overall business, which brought in about $214 billion in the past 12 months.
Nonetheless, Meta is moving forward with its plans. The company expects to spend between $130 billion and $145 billion on capital expenditures in 2026. This is a major commitment to its future. Yet, as Meta continues to build out its infrastructure, it will also deal with the costs associated with this expansion, which contributed to a recent earnings shortfall.