Meta CTO Andrew Bosworth acknowledged "real cause for sadness" following cuts to the company's Reality Labs division, whilst maintaining Meta remains "extremely bullish on VR". Speaking on Instagram, he admitted the VR industry was growing "more slowly than we had hoped". Reality Labs has accumulated over $70 billion in losses since 2020. Bosworth said Meta's investment exceeded what the ecosystem's growth could support, leading to cuts in several VR products including virtual workplace and fitness apps. Despite the pullback, Bosworth insisted Meta is investing more in VR content than any competitor and that the company's AI glasses bet doesn't require choosing between products. However, he noted investments must match growth rates, suggesting limits to Meta's commitment. Last year, Bosworth called 2025 make-or-break for the metaverse effort.

Meta has partnered with Bill Gates' TerraPower and Sam Altman-backed Oklo to develop approximately 4 gigawatts of small modular reactor projects, marking what analysts view as a watershed moment for next-generation nuclear power in the US. The deal, announced in January, will provide clean energy for Meta's planned Prometheus AI campus in Ohio and other facilities. TerraPower's agreement includes two reactors online by 2032, with options for six additional units totalling up to 2.8 gigawatts. Oklo plans to start construction this year in Pike County, Ohio, with first reactors operational by 2030. Analysts expect more Big Tech nuclear deals in 2026 as data centre demand surges. Small modular reactors can be built in three years versus a decade for traditional reactors, offering faster deployment for power-hungry AI infrastructure.

The four major US tech companies—Alphabet, Microsoft, Meta and Amazon—are expected to spend nearly $700 billion combined on AI infrastructure this year, a 60% increase from 2025. However, this aggressive buildout is significantly impacting free cash flow. Amazon projects negative free cash flow of up to $28 billion in 2026, according to Bank of America analysts. Pivotal Research estimates Alphabet's free cash flow will plummet 90% to $8.2 billion from $73.3 billion last year. Barclays forecasts similar declines for Meta, with potential negative cash flow in 2027-2028. The spending spree is forcing companies to tap debt markets. Alphabet quadrupled its long-term debt to $46.5 billion in 2025, whilst Amazon may raise additional equity and debt. Despite these pressures, analysts remain bullish, viewing the infrastructure investment as creating competitive moats in the AI race.