Meta stock surged more than 9% on July 1 after the company announced plans to build a cloud business that would sell excess AI computing power to outside customers, easing investor concerns about whether its massive infrastructure spending will generate returns.

The announcement came as Bloomberg reported that Meta Platforms is developing a cloud infrastructure business to compete with Amazon Web Services, Microsoft Azure, and Google Cloud. The move gives Meta a potential new revenue stream from its enormous AI investments.

Meta has faced mounting questions about its aggressive capex spending. The company raised its 2026 capital expenditure guidance to between $125 billion and $145 billion in April, nearly double its 2024 spending…