Meta shares dipped after a disappointing Q2 revenue outlook and plans to spend nearly $100 billion this year as it aims to “invest aggressively” in its AI products.

Meta (META) shares dropped 15% in after-hours trading after a weak outlook for Q2 revenue and plans to “aggressively” ramp up spending in artificial intelligence (AI) this year — while its metaverse division is expected to continue to run at a loss.

The tech giant’s financial chief, Susan Li, said in its April 24 Q1 results that its revenue guidance for the Q2 falls between $36.5 billion and $39 billion — below reported Wall Street expectations of $38.3 billion.

Li expects expenses to rise to between $96 billion to $99 billion — up from $94 billion to $99 billion due to “higher infrastructure and legal costs.”

She also bumped full-year 2024 capital expenditures to a top end of $40 billion from its prior $37 billion as it would “invest aggressively to support our ambitious AI research and product development.”

Meta posted Q1 revenues of $36.46 billion — a 27% year-on-year (YOY) jump that surpassed Wall Street analysts’ Zacks estimate of $36.28 billion by 0.48%.

Its earnings per share doubled YOY to $4.71, beating estimates of $4.32 per share.

Its metaverse building Reality Labs lost $3.85 billion in Q1 — down from the nearly $4 billion it lost in Q1 2023; Meta expects these losses to increase YOY as it bankrolls the division’s product development.

An increasing amount of our Reality Labs work is going toward serving our AI efforts,” said CEO Mark Zuckerberg on an earnings call.

He expected a “multi-year investment cycle” before Meta “fully scaled” its AI businesses.