If Mark Zuckerberg Says These Words on July 29, Meta Platforms' Stock Could Skyrocket

All eyes will be on Meta Platforms (NASDAQ: META) on July 29. That's when it reports second-quarter earnings, and there will be one major question looming on that date: Will Meta Platforms launch a cloud computing business?

If CEO and founder Mark Zuckerberg makes an announcement about a cloud computing platform, I think the stock could skyrocket. On the flip side, if he says it's not happening anytime soon, don't be surprised if the stock sells off, as the market is starting to expect this new segment from Meta.

Regardless, I think Meta is still a strong investment option, and investors should consider scooping it up before its July 29 earnings release.

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A cloud computing business helps justify Meta's spending

The big four AI hyperscalers include Meta Platforms, Amazon, Microsoft, and Alphabet. These four got grouped because they are spending hundreds of billions of dollars on data center capital expenditures.

The $650 billion spending in 2026 isn't the peak, either. Nvidia, the major supplier of computing units for the AI build-out, projects this figure will rise to $1 trillion in 2027. That's incredible growth and showcases the robust demand for AI computing.

While many businesses are being formed that use AI computing resources, the jury is still out on whether all the AI spending will be worth it, especially for companies developing AI models. Some worry that generative AI will basically be a commodity, and there won't be much money in store for the companies that develop the models. However, cloud computing businesses, like the ones Amazon, Microsoft, and Alphabet have built, generate revenue each time computing resources are used, so they will still make out fine over the long term.

This concern is why the market has been skeptical of Meta's strategy over the past few years: It's spending heavily and hasn't made much progress, yet it has a vast amount of computing resources. Zuckerberg has told investors that he has considered forming a cloud computing business if excess computing capacity becomes available.

A recent Bloomberg report speculated that a cloud business is already being formed, creating a new revenue stream for Meta that would be quite lucrative in the long term. This would justify the spending on those centers, making Meta a far more attractive investment.

If Meta announces this on July 29 during its Q2 earnings report, I think the stock could easily rocket higher. But if Zuckerberg says it won't happen anytime soon, don't be surprised to see the stock sell off, as the market has started to suspect this launch for a while and has priced some of it already.

Keithen Drury has positions in Alphabet, Amazon, Meta Platforms, Microsoft, and Nvidia. The Motley Fool has positions in and recommends Alphabet, Amazon, Meta Platforms, Microsoft, and Nvidia. The Motley Fool has a disclosure policy.