Meta (META) stock took a beating on Thursday, after the company said during its third quarter earnings report that it plans to further hike AI spending for the rest of this year and in 2026.

Shares of Meta fell more than 11% midday, as Wall Street analysts and investors digested the news.

CEO Mark Zuckerberg summed up the spending plan as a means to keep up with the demand for AI, but said that if the company overbuilds, it can absorb the extra computing capacity in the future.

“We keep on seeing this pattern where we build some amount of infrastructure to what we think is an aggressive assumption, and then we keep on having more demand to be able to use more compute, especially in the core business,” Zuckerberg explained.

“I mean, it’s, of course, possible to overshoot that right? And if we do … then you know, we see that there’s just a lot of demand for other new things that we’d build internally, externally … almost every week, people come to us from outside the company, asking us to stand up an API [application programming interface] service or asking if we have different compute that they could get from us, and we haven’t done that yet,” he added.

In a worst case scenario, in which Meta builds too much capacity that goes unused, Zuckerberg said it would mean the company simply prebuilt what it will need in the future, though it would also have to contend with some losses and depreciation.

That’s not exactly what Wall Street wanted to hear, though.

Analysts at a number of banks slashed their price targets on Meta’s stock following the earnings report. BofA Global Research analyst Justin Post cut the firm’s price objective for Meta from $900 to $810, but reiterated his Buy rating on the stock.

KeyBanc Capital Markets’ Justin Patterson also dropped his price target, from $905 to $875, while keeping his Overweight rating.

TD Cowen analyst John Blackledge also reduced his price target on Meta from $875 to $810, but maintained his buy rating.

Morgan Stanley’s Brian Nowak, Goldman Sachs’ Eric Sheridan, Citi’s Ron Josey, and Cantor Fitzgerald’s Deepak Mathivanan, among others, also lowered their price targets while keeping their ratings at either a Buy or Overweight.

But not everyone is negative on the company. HSBC’s Nicolas Cote-Colisson held his price target at $905, as did Wedbush’s Scott Devitt.

Importantly for Meta, Zuckerberg says that the company’s AI-powered ad tools now have an annual run rate of $60 billion, showing that the spending is at least paying off.

Still, that wasn’t enough to change the perception that the company could be overspending. On top of that, Meta reported yet another $4 billion loss related to its Reality Labs segment.