Mark Zuckerberg Just Made a Stunning Prediction. Is Meta Platforms Now a Must-Own AI Stock?

Despite the focus on LLaMa’s big language model and new devices like Ray-Ban’s smart glasses, discussions about investing in the best artificial intelligence (AI) stocks have largely ignored Meta Platforms (NASDAQ:META).

Instead, Nvidia is considered the clear leader in AI hardware, while the financial media has portrayed it Microsoft AND Alphabet vying for dominance in the user-facing AI market, including chatbots like ChatGPT and Gemini, cloud infrastructure, and productivity software.

But Meta is proving that potential investors can no longer ignore its strides in the AI ​​space. The stock has surged since the generative AI race began with the launch of ChatGPT, and has outpaced its “Magnificent Seven” peers like Microsoft and Alphabet in revenue growth over the past four quarters.

Meta just reported revenue rising 22% to $39.1 billion in the second quarter, while operating income rose 58% to $14.8 billion as the company benefited from early layoffs and other cost controls.

While investors were impressed with the company’s results, sending its stock up 7% after the close of trading, one statement from CEO Mark Zuckerberg could prove to be a game-changer for Meta Platforms.

The new king of AI?

Zuckerberg kicked off the earnings call by telling investors, “Meta AI is on track to be the most-used AI assistant in the world by the end of the year,” a statement few analysts would have expected to be true a year ago.

While ChatGPT has captured the attention of the generative AI race, Meta AI is emerging as a dark horse, poised to replace the chatbot that ushered in the era of generative AI. If Zuckerberg is right, Meta’s AI chatbot will overtake ChatGPT, Microsoft’s Copilot, and Alphabet’s Gemini, making his company the leader in generative AI, at least by one key metric: usage.

Same as Apple has with its iPhone, Meta’s properties, which include Facebook, Instagram, and WhatsApp, have allowed it to forge close relationships with its customers. That’s something that Microsoft and Alphabet’s Google don’t have, since their AI properties are mostly used for work or research.

In addition to Meta’s surprising prediction for its chatbot, Zuckerberg also outlined a fascinating vision for the company’s future in artificial intelligence.

For example, he envisions his company using AI to generate creative content for advertisers and personalize it for target audiences. Ultimately, Zuckerberg sees the technology being able to handle an entire marketing campaign with just a business objective and budget. That would be a huge win for advertisers, who make up the company’s customer base.

The story continues

He also added that Meta wants to equip every company on its platform with an AI-powered agent and believes this will become the basis for trading in the future.

Meta AI’s success is also reflected in the company’s broad and growing reach. It ended the quarter with 3.27 billion daily active users, up 7% from a year earlier — or more than 40% of the world’s population. The average American adult spends 34 minutes a day on Meta sites, showing why the company is poised to lead the AI ​​assistant space.

Before ChatGPT launched, Zuckerberg said Meta would control the next computing platform. At the time, he envisioned it as the metaverse, but now it seems clear it will be generative AI, and Meta seems just as ready for that shift.

Are Meta shares worth buying?

The company doesn’t have a direct way to monetize Meta AI, but it doesn’t need one. As it grows and engages its audience, companies will spend more money on advertising to reach them and sell more products and services through their sites, increasing Meta’s revenue and strengthening their platforms.

The company continues to spend billions of dollars a quarter on Reality Labs, and it’s unclear whether this experiment will ever pay off. But the core business is profitable enough to sustain the adventure, and Meta continues to trade at a modest valuation. Based on Wednesday’s after-hours price, the stock is trading at a price-to-earnings ratio of 26.5, broadly in line with S&P500.

But Meta Platforms has continued to see explosive growth and now looks set to be a surprise winner in the AI ​​chatbot race. The stock belongs in any AI portfolio and should continue to rise given its momentum, its vast reach through apps, and its proficiency in AI.

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Randi Zuckerberg, former chief market development officer and spokeswoman for Facebook and sister of Meta Platforms CEO Mark Zuckerberg, is a member of The Motley Fool’s board of directors. Suzanne Frey, chief executive officer at Alphabet, is a member of The Motley Fool’s board of directors. Jeremy Bowman has positions in Meta Platforms. The Motley Fool has positions in and recommends Alphabet, Apple, Meta Platforms, and Microsoft. The Motley Fool recommends the following options: long January 2026 $395 call options on Microsoft and short January 2026 $405 call options on Microsoft. The Motley Fool has a disclosure policy.

Mark Zuckerberg Just Made a Stunning Prediction. Is Meta Platforms Now a Must-Own AI Stock? was originally published by The Motley Fool