Meta rents out more than computing power! But is there really excess computing power right now?
$META is reportedly planning cloud business, renting out remaining AI computing resources to compete with cloud service providers such as Amazon AWS, Microsoft Azure, and Google Cloud.
The market reaction to this news is that capital expenditures will be reduced, so upstream AI hardware manufacturers have fallen.
But I think the market reaction is overblown. It’s still too early to interpret this news as “a coming surplus of computing capacity.”
Based on Meta’s current public situation, it seems closer to “continuing to obtain more computing power.”
1. Computing power is scarce (In March, Google limited Gemini’s computing capacity, delaying some projects)
2. It’s so tight that even DDR4 has to be reclaimed for reuse, while DDR5 is mixed in (06-29 ISCA 2026)
3. Meta continues renting and using computing power.
In March, it signed a five-year AI infrastructure agreement with Nebius, worth up to 27 billion USD.
4. In April, it expanded its partnership with CoreWeave, signing a 21 billion USD AI cloud computing agreement.
6. In June, it reached an agreement with Crusoe, renting approximately 1.6 GW of compute capacity.
My guess is that Meta may have seen xAI “monetizing idle servers for rent,” effectively acting as a landlord to collect rent and accelerate cash recovery.
Because Meta’s spending in 2026 is 125–145 billion USD, this kind of approach can ease market concerns about Meta making heavy AI investments and continuously burning cash, while also creating a new revenue stream. After all, using Meta AI to improve ads only increases revenue as much as that.
Most importantly, is Meta’s own AI still so weak that it can only sell computing power?
Similar approaches exist in Elon Musk’s SpaceX renting out idle data centers:
In May, it rented to Anthropic for 1.25 billion USD per month.
In June, it rented to Google for 0.92 billion USD per month.
First, act as the landlord to rent out compute and pocket 2.17 billion per month.
The market didn’t really react to SpaceX renting excess computing power to Anthropic or Google, but when Meta rents out computing power, it seems like “the sky is falling.”?
$META is reportedly planning cloud business, renting out remaining AI computing resources to compete with cloud service providers such as Amazon AWS, Microsoft Azure, and Google Cloud.
The market reaction to this news is that capital expenditures will be reduced, so upstream AI hardware manufacturers have fallen.
But I think the market reaction is overblown. It’s still too early to interpret this news as “a coming surplus of computing capacity.”
Based on Meta’s current public situation, it seems closer to “continuing to obtain more computing power.”
1. Computing power is scarce (In March, Google limited Gemini’s computing capacity, delaying some projects)
2. It’s so tight that even DDR4 has to be reclaimed for reuse, while DDR5 is mixed in (06-29 ISCA 2026)
3. Meta continues renting and using computing power.
In March, it signed a five-year AI infrastructure agreement with Nebius, worth up to 27 billion USD.
4. In April, it expanded its partnership with CoreWeave, signing a 21 billion USD AI cloud computing agreement.
6. In June, it reached an agreement with Crusoe, renting approximately 1.6 GW of compute capacity.
My guess is that Meta may have seen xAI “monetizing idle servers for rent,” effectively acting as a landlord to collect rent and accelerate cash recovery.
Because Meta’s spending in 2026 is 125–145 billion USD, this kind of approach can ease market concerns about Meta making heavy AI investments and continuously burning cash, while also creating a new revenue stream. After all, using Meta AI to improve ads only increases revenue as much as that.
Most importantly, is Meta’s own AI still so weak that it can only sell computing power?
Similar approaches exist in Elon Musk’s SpaceX renting out idle data centers:
In May, it rented to Anthropic for 1.25 billion USD per month.
In June, it rented to Google for 0.92 billion USD per month.
First, act as the landlord to rent out compute and pocket 2.17 billion per month.
The market didn’t really react to SpaceX renting excess computing power to Anthropic or Google, but when Meta rents out computing power, it seems like “the sky is falling.”?