Meta Platforms Acquires AI Startup Manus to Bolster Tech Arsenal
The after-hours deal for the artificial intelligence firm signals Meta's continued aggressive spending to keep pace with rivals in the burgeoning AI technology race.
Meta Platforms Inc. (META) has acquired artificial intelligence startup Manus, a move announced late Monday that underscores the technology giant's aggressive strategy to deepen its AI capabilities amid a heated industry-wide arms race.
The deal, revealed at 17:21 ET after the close of regular trading, is part of Meta's broader push to embed advanced AI into its ecosystem of apps and future hardware. Financial terms of the acquisition were not immediately disclosed. According to a Bloomberg report, the acquisition is aimed at strengthening Meta's core AI infrastructure as it competes with giants like Google, Microsoft, and Amazon.
Shares of Meta closed at $658.69, down 0.69% in regular trading. The timing of the announcement after market hours suggests that any investor reaction will be priced into Tuesday's pre-market and opening bell.
This acquisition caps a year of massive investment for the social media company, which has funneled capital into becoming an 'AI-first' organization. According to company filings, Meta projected capital expenditures for 2025 to fall between $64 billion and $72 billion, largely dedicated to building out the computational power needed for its ambitious AI projects. The strategy has already shown fruit, with recent quarterly results demonstrating a 26% year-over-year revenue surge, significantly driven by the enhanced performance and engagement from its AI-powered advertising tools.
The Manus deal represents a 'tuck-in' acquisition, a strategic purchase of a smaller company for its specialized technology and expert talent rather than for its revenue. While details on Manus remain scarce, sources familiar with the deal describe it as a firm specializing in creating more efficient processes for training large-scale AI models, a critical bottleneck in the development of more powerful and complex systems.
This technology could prove vital as Meta works to expand its proprietary AI, including the next generation of its open-source Llama large language models, and enhance its AI-driven content recommendation engines for Instagram and Reels. The company has stated it expects to operate over 1.3 million graphics processing units (GPUs) by the end of 2025 to power these initiatives.
Analysts view these aggressive investments as a necessary cost of competition. The broader tech landscape has seen rivals make similar nine-figure bets, with Google parent Alphabet committing approximately $75 billion to AI and cloud capacity in 2025, and Amazon planning to invest around $100 billion in similar initiatives. Analysts at Morgan Stanley have noted that for Meta, "betting the house on AI is not just an option, but a necessity to maintain its dominance in the digital advertising market and to build a foundational platform for the metaverse."
With a market capitalization of approximately $1.67 trillion, Meta has the balance sheet to support its AI ambitions. The company's focus on AI has been a key factor in its stock performance this year, with a strong consensus from Wall Street. Analyst price targets average around $837, reflecting a bullish outlook on its ability to monetize these deep technology investments.
Looking forward, the integration of Manus's team and technology will be closely watched. Investors will be keen for any commentary from CEO Mark Zuckerberg on the company’s next earnings call regarding how the new acquisition fits into Meta's long-term vision, which inextricably links its social media empire, its vast advertising business, and its Reality Labs division building the future of augmented and virtual reality.