The Instagram parent will spend more than $1.5 billion on the new facility, which is being built in El Paso, Texas, the company said in a blog post Wednesday. The data center will eventually have 1 gigawatt of capacity to power high-end computing chips for AI-related projects, according to the post. It’s expected to come online in 2028, a company spokesperson said.
Meta has been spending aggressively on AI infrastructure and talent alongside rivals like OpenAI and Alphabet Inc.’s Google, all of which are developing top-of-the-line AI models. Meta earlier this year announced a major data center project in Louisiana, nicknamed “Hyperion,” which President Donald Trump said could cost as much as $50 billion.
Meta has raised $29 billion for that project from Pacific Investment Management Company and Blue Owl Capital, and the company is building other gigawatt-sized data centers, including one in Ohio called “Prometheus.”
Artificial intelligence has become a key focus for the company, which uses the technology to power its chatbot and also serve people relevant videos and advertisements on Instagram and Facebook. Chief Executive Officer Mark Zuckerberg has said that personal AI assistants will be “one of the most important and valuable services” ever created.
Meta will spend as much as $72 billion this year in capital expenditures, including AI-related infrastructure projects. Zuckerberg has defended the aggressive spending, arguing that it’s better to over-spend than under-spend when it comes to AI.
“There’s a meaningful chance that a lot of the companies are overbuilding now,” he told Bloomberg in 2024. “But on the flip side, I actually think all the companies that are investing are making a rational decision, because the downside of being behind is that you’re out of position for, like, the most important technology for the next 10 to 15 years.”
Separately, semiconductor technology provider Arm Holdings Plc said Wednesday that it’s extending its partnership with Meta. The two have agreed on a multi-year agreement under which they’ll expand on their efforts to co-design software and hardware.
Meta will use Arm’s Neoverse blueprint for data center chips, which should provide better performance and use less power than rival offerings based on Intel technology, the two said in a statement.
Arm’s stock rose as much as 3.5% following the announcement in New York trading before later erasing most of those gains.
