A Billionaire’s Bet on Meta’s AI Ambitions

While many investors express caution over Meta Platforms' substantial planned expenditures in artificial intelligence, one prominent billionaire is moving in the opposite direction. Bill Ackman's Pershing Square Capital Management has established a major stake in the social media giant, signaling a strong vote of confidence in its long-term strategy.

According to its annual investor presentation held on Wednesday, Pershing Square has built a position in Meta that constitutes 10% of the fund's total capital. The hedge fund views the company's shares as "significantly undervalued," citing an attractive valuation of approximately 22 times expected earnings for the next twelve months. This multiple appears particularly compelling to Pershing Square when compared to peers like Alphabet, Apple, and Nvidia.

Key rationales behind the investment include:

• The market is underestimating Meta's long-term potential in artificial intelligence.
• The current valuation is favorable relative to other major technology competitors.
• The position was established during the fourth quarter of 2025.

This move positions Ackman against a prevailing sentiment of concern among some shareholders. Those worries are fueled by Meta's guidance for AI-related capital expenditures ranging between $115 billion and $135 billion for the year 2026.

Meta Forges Ahead with Infrastructure Expansion

Coinciding with this investment news, Meta has broken ground on a massive new data center in Lebanon, Indiana. The facility, representing a $10 billion investment fully funded by the company, is projected to deliver 1 gigawatt of capacity upon completion—enough to power roughly 800,000 homes.

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

Rachel Peterson, Meta's Vice President of Data Center Strategy, anticipates the site will become operational by late 2027 or early 2028. The company is also funding all necessary infrastructure upgrades from its own balance sheet.

This project in Indiana is a single component of a much broader expansion plan. In November, Meta announced a commitment to invest $600 billion over three years into U.S. infrastructure and job creation. Other notable projects under this initiative include a $27 billion financing partnership with Blue Owl Capital for a 2-gigawatt data center in Louisiana, and a $1.5 billion facility planned for Texas.

Share Performance and Financial Context

Meta's stock closed at $668.69 on February 11. Over the preceding twelve-month period, the share price has declined by approximately 16%.

This downward pressure persists despite robust fundamental financial results. For the fourth quarter of 2025, Meta reported revenue growth of 25% to $59.89 billion, with an operating margin of 40%. The company's full-year 2025 revenue totaled $200.97 billion.

Analysts, such as those at the Baron Durable Advantage Fund, have noted that projected capital and operating expenses for 2026 are exceeding prior expectations. This raises a central question for the market: when will the company's massive AI investments begin to yield a tangible return? Through his fund's recent activity, Bill Ackman appears to have a definitive answer and is deploying capital accordingly.