Artificial intelligence has the potential to not only enhance Meta’s existing apps but also to open up a new revenue stream for the business.
Meta Platforms (META 1.60%) boasts billions of active users across its various platforms such as WhatsApp, Facebook, Instagram, and Messenger. With such a massive user base, Meta has the opportunity to experiment with new products and services. For instance, its Threads platform saw rapid growth, attracting over 100 million users in under five days after its launch due to its seamless integration with Instagram.
Meta is now setting its sights on artificial intelligence (AI) as the next big venture. CEO Mark Zuckerberg views AI as a significant opportunity for the company, despite entering the game slightly later than some competitors. The latest AI model released by Meta, Llama 3.1, outperforms other well-known models like GPT-4o and Claude 3.5 Sonnet on various benchmarks. By making this model open-source, Meta aims to attract developers to improve and enhance the AI over time. The integration of AI into Meta’s applications and virtual reality headsets ensures exposure to a large user base.
Can Meta’s AI outperform ChatGPT?
While ChatGPT has garnered attention by amassing 200 million monthly active users since its launch in November 2022, Zuckerberg believes that Meta’s AI has the potential to surpass these numbers before the end of the year.
By leveraging its vast user base, Meta’s AI initiative could not only attract more users but also lead to increased engagement within its current applications. This enhanced user experience could potentially result in higher ad revenue for the company. If Meta’s AI can prove its worth and retain users, it may pave the way for monetization opportunities, similar to subscription models seen in other AI platforms like ChatGPT and Microsoft’s Copilot.
Meta’s strong financial performance, with sales growing by 22% and net income rising by 73%, coupled with the potential boost from AI integration, could further fuel the company’s growth trajectory. However, the success of Meta’s AI endeavor will be a critical factor in determining the future potential of the stock.
Should you buy Meta Platforms stock?
While Meta’s growth prospects are promising, investing in the stock may be prudent once the efficacy of its AI assistant is proven. Competition in the AI space is fierce, and Meta will need to demonstrate the value and superiority of its AI platform to attract and retain users successfully.
If Meta can demonstrate the success of its AI initiative, it could be a significant catalyst for the company’s growth trajectory, making it an attractive investment option.
Randi Zuckerberg, a former director of market development and spokeswoman for Facebook and sister to Meta Platforms CEO Mark Zuckerberg, is a member of The Motley Fool’s board of directors. David Jagielski has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Meta Platforms and Microsoft. The Motley Fool recommends the following options: long January 2026 $395 calls on Microsoft and short January 2026 $405 calls on Microsoft. The Motley Fool has a disclosure policy.
