Meta to spend $10 billion on AI data center in El Paso, 1GW by 2028

Meta is boosting its spending commitment on a forthcoming AI data center in West Texas by more than sixfold to $10 billion, with an aim to reach 1 gigawatt of capacity by the time the facility comes online in 2028, the company said on Thursday.

The data center being built in El Paso will lead to the creation of 300 new jobs, Meta said, with more than 4,000 construction workers required at its peak. The company also said it’s committed to adding over 5,000 megawatts of clean power to the grid, and will ease the water burden by working with specialized nonprofits to bring fresh water to the area.

“Since breaking ground last year, we have been proud to call El Paso home and are committed to being a good neighbor,” the company said in a blog post on Thursday.

When Meta started construction at the 1.2-million-square-foot site in October, its planned investment was $1.5 billion. Gary Demasi, Meta’s vice president of data center development, revealed the steppedup investment at an annual Borderplex Alliance summit in El Paso.

Meta is ramping up its spending on artificial intelligence infrastructure as the company and its hyperscaler peers try to meet what they say is unprecedented and soaring demand for computing resources. In its latest earnings report in January, Meta said capital expenditures for the year would reach up to $135 billion.

But unlike tech rivals Google, Amazon and Microsoft, Meta doesn’t have a cloud infrastructure business, and its hefty spending is garnering extra scrutiny from Wall Street. The stock is down 16% for the year, including a 7% drop on Thursday that followed two stinging defeats in court this week related to the company’s failure to adequately police Facebook and Instagram.

Meta has been cutting costs elsewhere as it pours resources into AI. On Wednesday, the company confirmed to CNBC that hundreds of layoffs are coming across Facebook, global operations, recruiting, sales and its virtual reality division.

But its data center expansion continues.

Meta has a total of 30 data centers, including new ones in the works, with 26 of the facilities in the U.S. The El Paso site is its third in Texas.

The company is also spending heavily on chips and systems to fill the new data centers. In February, the company signed massive deals with Nvidia and Advanced Micro Devices, and this week committed to become the first customer for Arm’s new data center processor. Meta also recently unveiled four new versions of its in-house MTIA accelerators that the company first disclosed to the public in 2023.

As a flurry of AI data centers spring up across the country, the projects have increasingly faced backlash from nearby residents,…