One of America’s biggest investors Michael Burry to Mark Zuckerberg: You are making a mistake by … |

Investing heavyweight Michael Burry has voiced significant concerns over Meta’s grand plans for its AI framework, dubbed Meta Compute. He warns that the company’s strategy of constructing vast data centers and bespoke chips could jeopardize its return on invested capital, signaling a departure from its previously successful, resource-efficient software approach.

Michael Burry, one of America’s biggest investors has now issued a sharp warning to Meta CEO Mark Zuckerberg, criticising the company’s massive push into artificial intelligence infrastructure. Recently, Meta CEO Mark Zuckerberg announced that Facebook-parent is establishing a new top-level initiative called Meta Compute. “Meta is planning to build tens of gigawatts this decade, and hundreds of gigawatts or more over time. How we engineer, invest, and partner to build this infrastructure will become a strategic advantage. This effort will be led by Santosh Janardhan and Daniel Gross,” said Zuckerberg in a post on Threads. Now, in a post shared on social media platform X (formerly known as Twitter) Burry said that Meta is wasting its saving grace by building Meta Compute. He further added that creating Meta Compute will means to ‘Watch ROIC crash’.

Michael Burry’s critique of Meta Compute

“And Meta gives in, throwing away its one saving grace. Watch ROIC crash,” wrote Burry. He made this comment on the Meta Compute announcement made by Zuckerberg. Burry feels that Meta’s ‘saving grace’ has always been its asset-light software model, which generated enormous profits from code and advertising with minimal physical infrastructure. He also argues that with Meta Compute, the company is undermining the efficiency that once made it a cash-generating powerhouse.Some online report suggests that Meta plans to spend $600 million via 2028 on data centres, energy grids, and custom chips to power Meta Compute. Burry feels that this spending spree will lead to a collapse in return on invested capital (ROIC) — a key measure of how effectually a company turns investment into profit. Unlike the past model, where profits scaled with relatively little capital, Meta’s new approach dramatically increases the denominator of the ROIC equation, making it harder to sustain high efficiency.Burry also accused Zuckerberg of of “giving in” to the industry-wide AI arms race, sacrificing Meta’s historically lean and profitable model for a high-risk, low-efficiency bet on physical infrastructure. While most of Wall Street has cheered Meta’s AI ambitions, Burry remains one of the few contrarian voices warning of long-term risks.

Mark Zuckerberg announced Meta Compute

In a post shared on Threads, Zuckerberg wrote, “Today we’re establishing a new top-level initiative called Meta Compute. Meta is planning to build tens of gigawatts this decade, and hundreds of gigawatts or more over time. How we engineer, invest, and partner to build this infrastructure will become a strategic advantage. This effort will be led by Santosh Janardhan and Daniel Gross.Santosh will continue to lead our technical architecture, software stack, silicon program, developer productivity, and building and operating our global datacenter fleet and network. Daniel will lead a new group responsible for long-term capacity strategy, supplier partnerships, industry analysis, planning, and business modeling.They will work closely with Dina Powell McCormick, who just joined Meta as President and Vice Chairman to work on partnering with governments and sovereigns to build, deploy, invest in, and finance Meta’s infrastructure. I’m looking forward to working closely with Daniel, Santosh, Dina and their teams to scale Meta Compute and deliver personal superintelligence to billions of people around the world.”