Mark Zuckerberg’s Meta is spending untold billions on infrastructure and top talent for its AI ambitions.

In fact, the CEO announced during the company’s earnings call on Wednesday, Meta will be spending between $70 billion and $72 billion on AI this year — up from its previous estimate of $66 billion to $72 billion, as CNBC reports.

Unsurprisingly, that cash bonfire isn’t going over well with investors. Meta’s shares slid by more than 11 percent on Thursday, indicating widespread skepticism about the company’s ability to stop bleeding billions of dollars as it races to keep up with the AI industry’s ever-escalating expenditure commitments.

That’s particularly striking because the drop comes in spite of Meta’s revenues exceeding Wall Street’s estimates. In other words, out of control AI spending is starting to rattle investors.

“The total dollar spend is just kind of what hangs us up a little bit,” Zacks Investment Management portfolio manager Brian Mulberry told the Wall Street Journal. “They have to start doing a better job of showing us when that comes back to the balance sheet.”

Mulberry questioned Meta’s ability to turn its ballooning expenditures into a return on investment.

“The return on invested capital is definitely a huge metric for us and the fact that they are being a little bit cagey and not quite upfront with what exactly is going on doesn’t help soothe those fears,” he told the WSJ.

The AI industry is seemingly approaching a major inflection point, with Meta competitors Alphabet, and Microsoft tripling down on AI by increasing their planned spending to even loftier heights, fueling fears of a growing AI bubble that could take down the entire US economy with it if ever pops.

In fact, a similar story to Meta’s is playing out at Microsoft as well. The company reported better-than-expected results this week — only for its stock to slide almost three percent as investors balked at the company’s forecast to increase its spending.

For Zuckerberg, it’s a matter of acting now, before it’s too late, highlighting a persistent fear of missing out among tech leaders.

“It’s pretty early, but I think we’re seeing the returns in the core business,” he told investors. “That’s giving us a lot of confidence that we should be investing a lot more, and we want to make sure that we’re not underinvesting.”

As such, Meta has been on an AI hiring spree this year, investing over $14 billion in AI startup Scale AI, and poaching its CEO, Alexandr Wang, to lead its so-called Superintelligence Labs. It’s been given out pay packages ranging from tens of millions to more than $1 billion in a desperate bid to attract talent.

Then, as Axios reported earlier this month, the company cut hundreds of roles from its AI unit — suggesting that the cracks could be starting to show.

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