Elevation Partners co-founder Roger McNamee said on CNBC that Meta CEO Mark Zuckerberg is creating an illusion that the company is well positioned in the AI race, arguing Meta is losing the race and criticizing Zuckerberg's latest AI manifesto. Meta shares are down 23% over the past year amid fears about heavy AI spending. The bull case highlights that Q2 ad revenue rose 27% year over year, ad impressions grew 14%, and average price per ad climbed 12%, with Advantage+ reaching a $75 billion annual run rate and over 9 million small businesses using at least one Meta AI tool. The bear case notes total expenses jumped 55% in Q2 while revenue grew 28%, operating margin sank from 43% to 31%, and CapEx guidance for fiscal 2026 sits at $130 billion to $145 billion, up from roughly $70 billion the prior year, with free cash flow collapsing to just $784 million, the lowest since 2022. Q3 guidance implies about 22% growth, down from 28% in Q2, and daily active people grew just 3.4%, with bears seeing diminishing returns on AI CapEx.
