JAKARTA A few days after DeepSee, a Chinese startup, revealed a major breakthrough in the cheap AI computing that rocked the American tech industry, Microsoft and Meta CEOs defended their great spending on remaining competitive in this growing field.
DeepSek has shocked the world of technology with AI models claimed to be able to compete even beyond the performance of the Western AI model at a much lower cost. However, Microsoft and Meta CEOs on Wednesday January 29 confirmed that building a large computer network remains important to meet the ever-increasing needs of the corporate.
Meta CEO Mark Zuckerberg, in a post-income call, stated that large investments in infrastructure and capital expenditures would be a long-term strategic advantage. "Investing huge funds for capital and infrastructure spending will provide strategic benefits over time," Zuckerberg said, quoted by VOI from Reuters.
Meanwhile, Microsoft CEO Satya Nadella said that large spending is needed to address capacity constraints that hinder the company's potential for utilizing AI technology. "As AI becomes more efficient and accessible, we will see demand growing exponentially," Nadella said in a call with analysts.
Microsoft has allocated 80 billion US dollars (Rp1.3 quadrillion) for AI in the current fiscal year, while Meta is committed to up to US$65 billion (Rp1.05 quadrillion) for this technology. In comparison, DeepSek simply claims to have spent about $6 million to develop its AI model, although this figure is likely to reflect the cost of computing power alone, not the overall development spending.
However, a number of investors are starting to lose their patience with the amount of disbursement without the large amount seen. Microsoft shares fell 5% in trading after working hours when the company expects Azure's cloud business growth in the coming quarters to be lower than expected.
Some analysts highlight the urgent need for companies like Microsoft and Meta to monetize their huge investment in AI. "We want to see a clear roadmap on monetization models for all the capital that has been invested," said Brian Mulberry, portfolio manager at Zack's Investment Management, which owns shares in Microsoft.
Meta, despite reporting a strong fourth quarter, provides mixed signals about the outcome of its AI-based tools with unsatisfactory sales projections for the current period.
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Futurum Group analyst Daniel Newman noted that this week it was a "wake-up call" for the United States. "For today's AI, there is too much capital expenditure, but consumption is not sufficient," he said.
Despite concerns, there are signs that executives are starting to move to address the challenge. Microsoft's CFO, Amy Hood, stated that the company's capital expenditure for the next quarter will remain at the level of 22.6 billion US dollars (Rp367.2 trillion) seen in the second quarter.
"We hope to continue investing based on a strong signal of demand in the fiscal year 2026. However, the growth rate will be lower than the fiscal year 2025 (which ends in June)," explained Hood.
Despite the pressure, Microsoft and Meta still believe that big spending on AI is key to maintaining their position as leaders in the era of ever-evolving technology.
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