Meta Platforms stock is trading near recent lows. What should traders watch with META? What Are The Recent Catalysts for Meta Platforms?Div Garg, founder and CEO of AGI Inc, recently argued that an "AI-agent future" could leave platforms that rely on human attention more exposed—calling out Alphabet and Meta Platforms as having the most to lose.
He says Meta’s ad-heavy model could face pressure if AI agents increasingly act as intermediaries between users and digital services, adding that Meta may need to find a revenue stream that doesn’t rely on ads.
Meta also has a fresh regulatory overhang after a 2-1 6th U.S. Circuit Court decision recently revived Ohio’s Social Media Parental Notification Act, which requires age verification and parental consent for users under 16.
Meta is also trading in a generally constructive premarket tape, with S&P 500 futures up 0.3% as traders position ahead of the opening bell.
Critical Price Levels To Watch for METAFrom a longer-term trend perspective, Meta is still in a drawdown, down 21.06% over the past 12 months, and the stock is trading below every major moving average that many institutions track. At $562.49, shares are 5.6% below the 20-day SMA, 9.3% below the 50-day SMA, 10.4% below the 100-day SMA, and 14% below the 200-day SMA—classic "sell-the-rally" posture unless price can reclaim those bands.
The crossover picture also stays heavy: the 20-day SMA is below the 50-day SMA, and the death cross (50-day SMA below the 200-day SMA) has been in place since December 2025. On momentum, MACD is below its signal line with a negative histogram, which points to fading upside pressure versus the prior upswing unless buyers can force a trend reset.
Key Resistance: $625.00 — a round-number area that lines up closely with the 100-day/50-day moving-average zone where rebounds can stall Key Support: $557.00 — a nearby floor just below current price where buyers previously stepped in, making it a key "line in the sand" for the next leg What Is Meta Platforms and How Does It Make Money?Meta is the largest social media company in the world, with close to 4 billion monthly active users across its "Family of Apps" (Facebook, Instagram, Messenger, and WhatsApp). The core business is advertising: Meta packages customer data and sells targeted ads to digital advertisers based on engagement across that ecosystem.
That’s why the AI-agent discussion matters for the stock—if agents reduce time spent researching, browsing, and clicking in the traditional way, the value of "human attention" as the product can get harder to defend. Meta has also been investing heavily in Reality Labs, but it remains a small part of overall sales, keeping the market’s focus on how durable the ad engine is.
META Earnings Preview: July 2026 EstimatesLooking further out, the next major catalyst for the stock arrives with the July 29, 2026 (estimated) earnings report.
EPS Estimate: $7.18 (Up from $7.14 YoY) Revenue Estimate: $60.19 Billion (Up from $47.52 Billion YoY) Valuation: P/E of 20.4x (Suggests fair valuation relative to peers) Analyst Consensus & Recent Actions: The stock carries a Buy rating with an average price target of $823.08. Recent analyst moves include:
RBC Capital: Outperform (Maintains Target to $810.00) (June 1) Rosenblatt: Buy (Maintains Target to $1015.00) (May 28) Wells Fargo: Overweight (Lowers Target to $765.00) (May 20) META Benzinga Edge Rankings BreakdownBelow is the Benzinga Edge scorecard for Meta Platforms, highlighting its strengths and weaknesses compared to the broader market:
The Verdict: Meta Platforms’s Benzinga Edge signal reveals a growth-and-quality-heavy profile that’s currently being held back by weak momentum. For longer-term investors, that often translates to "fundamentals can be attractive, but the chart still needs repair," with $625.00 as a key level to reclaim.
META Stock Price ActionMETA Stock Price Activity: Meta Platforms shares were up 1.06 at $568.16 on Wednesday, according to Benzinga Pro data.
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Since its April 29 initial public offering, PSUS has been on an aggressive buying spree.
The portfolio will also feature four newly acquired, undisclosed companies set to be revealed in the firm’s upcoming second-quarter report.
Chasing ‘Old-Fashioned’ ValueWhile the broader market fixates on semiconductor hype and emerging startup IPOs, Ackman is finding immense value in established mega-caps. Speaking at the All-In Liquidity Summit with NYSE, he noted that market momentum has unfairly shifted away from foundational tech leaders.
“A lot of attention has been taken away from companies that people think are almost old-fashioned,” Ackman explained to the summit crowd.
“Meta is an old-fashioned company today. Microsoft is an old-fashioned company today, and therefore, they’re less interesting. That’s not where the excitement is. The result of that is, you know, those stocks are very cheap,” he explained.
Ackman capitalized on this shifting sentiment, pointing out that his fund is now heavily invested in the “highest quality durable growth companies in the world,” which he believes are trading near historic valuation lows.
The ‘Double Discount’ OpportunityDespite its high-quality underlying portfolio, the PSUS stock, which is a closed-end listed fund, has lagged since its debut, currently trading at a roughly 20% discount to its net asset value (NAV) due to what Ackman attributes to short-term IPO technical factors.
However, the billionaire investor views this slump as a rare entry point. “A buyer of the stock at today's price is acquiring the current portfolio at a double discount,” Ackman stated.
To prove his conviction, Ackman and his Pershing Square affiliates have gone “all-in,” acquiring more than 10 million shares—totaling over $500 million—in the open market and IPO. “We have put our money where our mouth is,” he declared.
PSUS Drops Over 5% Since ListingThe stock has declined by 5.69% since its listing in April. However, it was up 4.26% over the last five sessions and 4.25% lower over the last month. It was up by 3.05% in premarket on Tuesday.
Disclaimer: This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.
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The Threads app icon on a smartphone in this illustration taken October 27, 2025. REUTERS/Dado Ruvic/Illustration Purchase Licensing Rights, opens new tab
June 16 (Reuters) - Meta Platforms (META.O), opens new tab said on Tuesday its Threads app had reached 500 million monthly active users, nearly three years after the social network platform was launched as a competitor to Elon Musk's X.
The social media company also announced new customization and community features on the platform.
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Here are some details:
Threads is rolling out "Your Algo", a feature that lets users privately control the content they see in their feeds. It is available in the United States, Canada, the UK, Australia and New Zealand.
Meta is expanding its Communities feature, allowing users to discover and participate in topic-focused groups more easily.
The company said communities have become a major driver of engagement on Threads. Meta is adding a dedicated Communities hub and new discovery tools designed to help users find conversations centered on specific interests.
The milestone comes as Meta continues to expand Threads' advertising business, putting the platform in more direct competition with X for digital advertising dollars.
Meta launched Threads in July, 2023.
Reporting by Harshita Mary Varghese in Bengaluru; Editing by Tasim Zahid
Our Standards: The Thomson Reuters Trust Principles., opens new tab
Mike Schroepfer, former CTO of Meta and founding partner of Gigascale Capital - a venture firm making early-stage bets on companies focused on climate impact - says SpaceX is the only company capable of building orbital data centers. He also shares how ocean data centers are 100x cheaper than orbital ones.
Meta Platforms Inc (NASDAQ:META, XETRA:FB2A, SIX:FB) has rolled out new AI-powered search capabilities across its apps as part of a broader push into AI-native products, with Bank of America analysts saying the update could mark an early step toward a larger search and monetization opportunity within the company’s ecosystem.
Bank of America wrote in a note that Meta’s new “AI Mode” search feature on Facebook allows users to find answers based on public posts across Meta platforms, including Groups and Reels. The feature uses Meta AI, powered by the MuseSpark large language model, to generate responses grounded in publicly shared user content, which the company says is intended to surface real-world perspectives and experiences rather than conventional web-based search summaries.
Alongside the search update, Meta introduced new AI creative tools, including photo and video editing features such as collage templates and automated video montage generation from camera roll content. The company also added AI-driven photo presets that allow users to modify attributes such as clothing, hair, and accessories.
Bank of America described the launch as an “interesting initiative” that leverages real-time public content to improve search relevance, particularly for queries related to products, services, and experiences where Meta’s social graph could provide differentiated context.
The firm added that incremental search activity could also generate new intent signals, potentially improving ad relevance and targeting within Meta’s advertising ecosystem.
The analysts believe that AI-enabled search could represent a long-term growth avenue if Meta is able to drive adoption at scale across its user base.
In a scenario analysis, Bank of America estimated that if Meta’s roughly 3.5 billion daily active users averaged one additional query per day through AI Mode, the feature could generate around 1.3 trillion annual queries. If 20% of those queries were commercial in nature and monetized through advertising, the firm suggested this could translate into approximately 50 billion ad clicks and roughly $15 billion in incremental revenue at a $0.30 cost-per-click assumption, or about 5% of consensus 2027 revenue estimates.
The firm also noted that AI Mode could serve as an entry point into more agentic use cases over time, potentially allowing Meta to play a larger role across the consumer journey from intent formation through to transaction within its closed ecosystem.
Bank of America maintained a ‘Buy’ rating on Meta, pointing to continued product innovation in AI as a key driver of future engagement and monetization.
The firm highlighted upcoming catalysts including consumer agentic product launches, more advanced large language models, the Connect conference in September 2026, and additional detail on Meta’s enterprise AI strategy.
Shares of Meta were little changed at $596 in the early afternoon on Tuesday, down almost 10% so far this year.
It’s hard to be genuinely bullish on stock markets these days, even as the AI revolution moves ahead and models like Claude Code and Claude Mythos look to transform the way we think about the software. Indeed, the powerful new AI tools sparked the SaaS-pocalypse, and the big question is whether we’ll be in for more AI-driven apocalypses in other parts of the economy as the new technology looks to threaten business models while creating new opportunities for investors.
Any way you look at it, the degree of uncertainty is at a high point with the rise of new kinds of AI models, many of which might need to stay behind closed doors for a while longer before the right safety guardrails can be put into place.
Add concerns about the closed models falling into the wrong hands, and perhaps more profoundly disruptive frontier technologies might hover in the background for a while longer, at least until the technology is guaranteed to be behind lock and key.
If the latest and greatest technology becomes less available to everyday users, the big question is what could happen next in the AI boom and whether investors will grow fatigued with the AI trade. Despite the profound, real applications of models like Mythos, questions linger about whether the massive CapEx being spent by hyperscalers will prove a smart investment.
At the same time, there are a lot of smart people (Michael Burry is just one) who view the AI boom as a bubble and one that could burst. History certainly seems to suggest such a revolutionary technological bull run won’t end all too well.
Meta Platforms: A historic discount in a hot AI market? But, in my view, I think it’s hard to paint a bubbly picture with too broad a brush, especially when you’ve got a company like Meta Platforms (NASDAQ:META | META Price Prediction) trading for 18.0 times forward price-to-earnings (P/E) with more than enough cash to spend aggressively.
While Meta’s newest model, Muse Spark, may face an uphill battle as a slew of other models compete for consumer engagement, I do think that the behind-the-scenes wins are most powerful for a company like Meta. In terms of invisible AI or monetization in the background, I think a company like Meta really does stand tall.
Perhaps the big money lies internally (think digital labor and automation) and not just in selling chatbots and agentics to consumers. Add the tremendous opportunity to sell agentics to the enterprise, and I think the market might be missing something with Meta as it moves fast, stays agile, and maintains its optionality.
Finally, it’s hard to know what the next big leap will be as frontier research goes above and beyond scaling. With a supercharged research team and deep pockets, I think owning Meta just makes sense, if not as a play on Zuckerberg’s leadership, perhaps as another major diversifier for an AI portfolio looking to have as many horses in the race as possible.
With Meta’s recent AI reorganization hitting suddenly and causing internal volatility, perhaps investors are too quick to dismiss the firm as it adopts a leaner, more aggressive strategy than some of its peers in the space. Add new AI features rolled into existing products, including Facebook’s AI Mode, into the equation, and it certainly does feel like Meta is taking a page out of the playbook of firms that have already found early wins in this AI boom.
The bottom line So, is AI a bubble or the real deal? The technology itself is very real. But in terms of the stocks playing the revolution, I’d argue that there exist ample opportunities as well as traps.
As an investor, it’s vital to put in the due diligence to ensure one’s betting on an appropriately-priced secular winner, rather than overpaying after a cyclical AI gainer that might already have a supercycle priced in. In terms of opportunities, perhaps the hyperscalers and not the crowded picks-and-shovels plays are where the generational moats are.
I keep hitting the buy button on Meta Platforms (NASDAQ:META | META Price Prediction), and the louder the market panics about the company’s $125 billion to $145 billion capital expenditure plan, the more shares I add. The stock sits at $593.48, down 9.94% year to date and 12.75% over the past year. To me, that is a sale tag on the most profitable advertising business ever assembled.
The thesis is simple. Mark Zuckerberg is reallocating capital away from human overhead and into compute infrastructure that compounds. He is directing resources into high-yield compute infrastructure that compounds returns. That changes the unit economics of every ad served to 3.56 billion daily users across Facebook, Instagram, WhatsApp, Messenger, and Threads.
The Receipts First, the cash machine is healthy under the hood. In fiscal 2025, Meta generated $115.8 billion in operating cash flow and still produced $46.1 billion in free cash flow after spending $69.7 billion on capital expenditures. The company self-funded the entire AI buildout from operations and returned $31.6 billion to shareholders through dividends and buybacks in the same year. No debt raise required.
Second, the engine is accelerating. Q1 2026 revenue came in at $56.3 billion, up 33.08% year over year, with EPS of $10.44 against a $6.6587 estimate. That was the fifth consecutive EPS beat. Ad impressions rose 19% while average price per ad climbed 12%. Volume and pricing are expanding together, which only happens when a platform owns its customers. The Q1 operating margin held at 41%.
Third, I am paying a fair multiple for that quality. Meta trades at a P/E of 21 with a forward P/E of 18, a PEG of 0.819, return on equity of 32.9%, and an operating margin of 40.6%. Analyst consensus price target sits at $827.32, with 49 Buy and 8 Strong Buy ratings against zero Sell calls. That is a quality compounder valued like a value stock.
The Honest Risk Reality Labs lost $19.2 billion in 2025 and another $4.03 billion in Q1 2026. Capex guidance climbing to $125 to $145 billion stacks depreciation pressure on top of that. Add youth-related litigation with trials scheduled in 2026 and EU advertising rules, and there are real ways this thesis takes damage. What keeps me buying is that the core ad business is funding all of it while still throwing off tens of billions in free cash, and CFO Susan Li was explicit that 2026 operating income will land above 2025.
Why The Buy Button Stays Active Zuckerberg told investors “Spark is just one step on that scaling ladder, and we are already training even more advanced models.” I believe him because the cash flow statement believes him. The advertising monopoly funds the AI buildout, the AI buildout sharpens the ad targeting, and 3.56 billion people show up every day to feed both flywheels.
So long as the ad engine keeps printing and Zuckerberg keeps converting operating cash into compute, my finger stays on the buy button.
ToplineThreads, Meta’s text-based social media platform that Forbes previously reported surpassed Elon Musk’s X in daily active users, reached a milestone of 500 million monthly active users three years after launch, the company said Tuesday.
Forbes previously reported in September that Threads had surpassed X in its number of daily active users. (Photo Illustration by Justin Sullivan/Getty Images)
Getty Images
Key FactsThreads, launched in 2023 and considered a competitor to X after Musk’s controversial takeover of Twitter, has grown rapidly and surpassed X in terms of daily active users in September, Forbes reported at the time.
Meta credited its “communities” feature for the platform surpassing the 500 million monthly active users milestone, which allows users to join spaces where they can discuss topics with others, like the NBA, books or movies.
Meta said Tuesday it would enhance the “communities” feature, advancing it out of the beta stage while updating visuals and adding a communities hub to the main menu of users’ feeds.
Meta also said it would unveil “Your Algo,” a feature that lets users indicate what topics they would like to see more or less of.
when did threads surpass x?Threads surpassed X in terms of daily active users on mobile devices worldwide in September, according to Similarweb data shared with Forbes at the time. Then, Threads barely edged out X, recording 130.2 million average daily users over X’s 130.1 million for the week ending Sept. 21. But since then, Threads has held a larger lead, with Threads logging 135.7 million average daily active users as of April, ahead of X’s 126.9 million average daily active users, according to Similarweb data. X has held a lead over Threads in the United States, though, recording 21.3 million average daily active users in the United States in April, ahead of Threads’ 18.3 million average daily active users.
how has threads built a large user base?Threads benefits from close integration with Meta’s flagship platforms, Facebook and Instagram. Mark Mahaney, senior managing director and internet research analyst at Evercore ISI, previously told Forbes Threads’ integration with Instagram, which CEO Mark Zuckerberg said in September has 3 billion monthly active users, is a “big advantage,” because Meta can “siphon you off from that massive platform over to Threads.” Threads may also be better than X at showing users targeted ads, Mahaney said, because Threads may already know information about its users from Meta’s other platforms, which he also said may be a “negative development for the attractiveness of X to advertisers.”
key backgroundThe close competition between X and Threads for users is the latest in a longstanding rivalry between tech billionaires Elon Musk and Mark Zuckerberg. The two have traded barbs as early as 2016, when Zuckerberg said he was “deeply disappointed” a SpaceX rocket carrying a Facebook satellite exploded. SpaceX called the explosion an “anomaly,” while Musk, years later, said the incident was “my fault for being an idiot.” Musk also suggested Zuckerberg has a “limited” understanding of artificial intelligence in a 2017 jab. The launch of Threads caused tensions to resurface, and the two publicly discussed fighting in a cage match organized by UFC president Dana White, which has never materialized. “I’m up for a cage match if he is lol,” Musk tweeted in 2023 in response to a tweet about Threads’ impending launch. Musk backed out, claiming he needed surgery, and Zuckerberg said if Musk ever gets “serious about a real date and official event, he knows how to reach me.” Musk criticized Threads as “just Instagram minus pics, which makes no sense,” while lawyers representing Twitter threatened to sue Meta shortly after Threads’ release for allegedly stealing trade secrets.
forbes valuationMark Zuckerberg, CEO and co-founder of Meta, is worth $203.6 billion as of Tuesday morning, according to Forbes estimates, making him the No. 7 richest person in the world. He owns about 13% of Meta’s stock. Elon Musk, the world’s richest person and first trillionaire, is worth $1.4 trillion, Forbes estimates as of Tuesday morning. Musk, the co-founder of companies including SpaceX and Tesla, became the world’s first trillionaire last week when SpaceX went public.
further readingThreads Finally Passes X—Zuckerberg’s 2-Year-Old Platform Passes Musk’s In Daily Users (Forbes)
Musk’s Net Worth Hits $1.4 Trillion—SpaceX Passes Amazon As Fifth-Largest Company (Forbes)
Key Takeaways Reddit posted Q1 2026 revenue growth of 69%, with advertising revenue rising 74% year over year. Reddit expanded its Shopify integration globally, streamlining ads, product syncing and tracking. META Q1 ad revenues increased 33%, but rising AI costs and regulatory scrutiny remain challenges. Reddit (RDDT - Free Report) and Meta Platforms (META - Free Report) are leading social media platforms that monetize user engagement through digital advertising. While RDDT is an emerging social media platform, gaining traction with community-driven advertising, Meta leads the broader social networking space through platforms like Facebook and Instagram.
RDDT or META — Which of these Digital Advertising stocks has the greater upside potential? Let’s find out.
The Case for RDDT StockReddit is benefiting from strong demand in its advertising business, which has become a key growth driver of the company’s impressive financial performance and future growth prospects. In the first quarter of 2026, Reddit reported total revenues of $663 million, up 69% year over year, with advertising revenues growing even faster at 74% to $625 million. This marks Reddit’s seventh consecutive quarter of revenue growth above 60%, underscoring the sustained momentum in its ad business.
Growth can be attributed to the company’s expanding portfolio, strong user engagement, including rising daily and weekly active users, gains in Average Revenue Per User and the expansion of advertiser tools such as Dynamic Product Ads (DPAs), Reddit Pixel and CAPI.
Reddit’s expanded partnership with Shopify remains noteworthy. In May 2026, Reddit expanded its Shopify integration globally, making it easier for merchants to launch DPAs and connect storefronts directly to Reddit’s advertising platform. The update includes streamlined account linking, automated product catalog syncing and a codeless Reddit Pixel for conversion tracking. Reddit also highlighted new retail research showing strong shopping intent among its users, with advertisers seeing higher returns on ad spend compared with other social platforms. The company highlighted that retail ad investment has grown significantly, reinforcing its position as a key destination for product discovery and purchase decisions.
Reddit’s investments in artificial intelligence (AI)-powered tools remain noteworthy. The launch and adoption of Reddit Max, an automated, AI-powered campaign tool, enabled advertisers to achieve a 17% reduction in cost per action and a 25% increase in conversion rate in the first quarter of 2026. About 50% of Max campaign advertisers now use AI-powered creative features, and brands like Cozy have reported a 35% higher ROAS and a 28% lower cost per acquisition with these tools.
The Case for META StockMeta Platforms’ focus on integrating AI into its platforms, which include Facebook, WhatsApp, Instagram, Messenger, and Threads, is driving user engagement to boost ad revenues. In the first quarter of 2026, Meta’s Advertising revenues were $55.02 billion, which increased 33% year over year.
A key factor behind this momentum is Meta Platform’s ongoing investment in AI to enhance both user and advertising engagements. AI is heavily dependent on data, of which META has a trove, driven by its more than 3.56 billion daily users. Meta Platforms continues to see strong engagement trends on Instagram Reels, with watch time up 10% and Facebook video time up 8% globally in the first quarter of 2026. AI-translated videos are now watched weekly by more than 500 million users on Facebook and Instagram. Threads continue to grow with more than 150 million daily active users.
Meta Platforms’ generative AI advertising tools are gaining strong traction, with more than 8 million advertisers using at least one GenAI ad creative tool in the first quarter of 2026. Video generation tools improved conversion rates by more than 3%, while adoption among small and medium businesses has been particularly strong.
Price Performance and Valuation of RDDT and METAIn the trailing 12-month period, shares of Reddit have gained 35.9%, whereas shares of Meta Platforms have plunged 14.9%. The outperformance in Reddit can be attributed to strong ad revenue growth, powered by automation and AI, the company’s expanding portfolio and strong user engagement.
Despite a strong portfolio and client base, Meta Platforms is facing rising costs in AI infrastructure, which are increasing expenses. Reality Labs continues to operate at a loss. The benefits from Meta AI and its agents are still in progress, and overall scrutiny from regulations and lawsuits is high.
RDDT and META Stock Performance
Image Source: Zacks Investment Research
Valuation-wise, RDDT and META shares are currently overvalued, as suggested by a Value Score of F and C, respectively.
In terms of the forward 12-month Price/Sales, RDDT shares are trading at 9.37X, which is higher than META’s 5.44X.
RDDT and META Valuation
Image Source: Zacks Investment Research
How Do Earnings Estimates Compare for RDDT & META?The Zacks Consensus Estimate for RDDT’s 2026 earnings is pegged at $4.83 per share, which has been unchanged over the past 30 days. This indicates an 84.35% year-over-year rise.
The Zacks Consensus Estimate for META’s 2026 earnings is pegged at $33.01 per share, which has increased 0.21% over the past 30 days. This indicates a 40.53% increase year over year.
RDDT and META’s earnings beat the Zacks Consensus Estimate in all the trailing four quarters. However, RDDT’s average surprise of 67% is higher than META’s surprise of 12.31%.
ConclusionWhile both Reddit and Meta Platforms stand to benefit from the booming digital advertising market, Reddit offers greater upside potential given its rapid revenue growth, surging advertiser base and expanding engagement tools.
Despite its dominant position in the digital advertising market, Meta Platforms faces rising costs in AI infrastructure that are increasing expenses and growing regulatory pressures that could weigh on its advertising growth. Stiff competition further limits its upside potential.
Both Reddit and Meta Platforms currently carry a Zacks Rank #3 (Hold) at present. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Meta Platforms is recommended as a buy due to its AI-driven strategy, which is driving digital advertising market share gains and operational outperformance. META's Advantage+ and upcoming Spark and GEM models are delivering superior ROAS, fueling 24%+ ad revenue growth and projected market share leadership over Google. Despite compressed valuation—forward P/E ~17.6x, EV/S ~5.3x—concerns over elevated AI capex and free cash flow are outweighed by robust growth and improving margins.
Meta CTO Andrew Bosworth. Bloomberg/Getty Images The vibes are off at Meta, its top leadership said internally.
Meta chief technology officer Andrew "Boz" Bosworth said morale at the tech giant is near an all-time low as recent mass layoffs and internal AI initiatives roil many longtime employees.
Morale is "maybe not the worst it's ever been in 20 years here, but it's probably up there. It's definitely up there," Bosworth said during an internal "Tuesdays with Boz" chat on June 2, four people who were on the call told Business Insider.
"I can think Cambridge Analytica was probably the worst," Bosworth added in reference to the scandal about millions of Facebook users' data being used to target voters during the 2016 election.
He then added that morale is "probably one of the worst it's ever been."
Meta declined to comment for this story.
It's been a difficult year for many Meta employees. Meta laid off 10% of staff in May, citing the need to offset its huge AI investments.
Meta reassigned roughly another 10% of its workforce to train its AI models. Some staff referred to joining the mandatory task force as being "drafted" and viewed the work largely as data-labeling, Business Insider previously reported.
In April, Meta also faced employee backlash over an initiative to track their mouse movements and keystrokes to improve Meta's AI models.
Meta leadership said it has begun taking steps to improve morale. On Monday, Bosworth sent a memo to staff about how Meta needs to "be the best place for the best people to do their best work," and that he hoped to "rekindle the best of the culture" that people joined, according to a copy obtained by Business Insider, which was first reported by Wired.
"We must provide our people the support to do things the right way for the long term, including taking smart risks when the situation calls for it and to be recognized for it," the memo read.
Meta will commit to transparency from its leadership and its employees' personal and career development, Bosworth's post added.
Meta will allow people reassigned to the AI task force to reapply for other jobs within Meta if they want to, and it is increasing budgets for travel, events, and snacks, Wired reported.
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Charles Rollet is BI's tech correspondent in San Francisco. Prior to joining BI, Charles worked at TechCrunch covering startups and VC. Charles is based in the Bay Area, where he enjoys hiking with his dogs. You can contact Charles securely on Signal at charlesrollet.12 or +1-628-282-2811.
Exclusive Meta Mark Zuckerberg More AI Layoffs Big Tech Business
Apple is preparing for a huge wave of new product releases, including camera- and AI-equipped AirPods and glasses that will launch the company into the red-hot AI device market — and into head-on competition with Meta’s own AI-enabled camera sunglasses.
Apple’s new AirPods mark the next step in its development of what it calls Visual Intelligence, technology that can analyze images and provide instant context, according to Bloomberg News.
The AI-juiced earbuds will closely resemble current AirPod Pro models, but with tiny cameras embedded in the stems.
Apple is preparing camera and AI-equipped AirPods. Getty Images Rather than capturing photos or video, the device’s computer-vision cameras would serve as sensors, supplying Siri with visual context – such as helping improve navigation during turn-by-turn walking directions.
The tech giant is also planning to launch its first smart glasses as soon as late 2027, Bloomberg reported. Code-named N50, the shades will compete with products from Mark Zuckerberg-led Meta and will feature more advanced cameras capable of capturing photos and video.
Meta – which has its own AI and camera tech embedded in Ray-Ban and Oakley sunglasses – has come under criticism as creeps and wannabe pickup artists have reportedly used them to record their come-ons to unsuspecting women, posting the pervy results in video form online.
Privacy advocates have also issued warnings about the potential dangers of wearable AI tech.
Apple’s AI AirPods will have external lights that can alert people around the wearer when data is being sent from the earbuds to the cloud, according to Bloomberg.
Early versions of Meta’s smart glasses have been able to take pictures and shoot videos. NurPhoto via Getty Images The new AirPods are intended to become Apple’s first AI-centric wearable device.
The release is set to come around the same time as a next-gen foldable phone and a new iPhone model to mark the product line’s 20th anniversary.
Apple intends the upcoming slate of offerings to be its largest debut of new products yet, Bloomberg reported.
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Early versions of Meta’s smart glasses have been able to take pictures and shoot videos. With the addition of AI, they can answer questions and respond with text on one lens for “Display” models or via audio built into the stems of non-Display models.
Apple has already made Visual Intelligence a centerpiece of its revamped Siri and iOS 27, integrating the feature directly into the Camera app.
The aim is to allow users to ask Siri questions about objects and their surroundings. A user looking at a selection of ingredients, for instance, could ask the assistant what to make for dinner.
The new AirPods are intended to become Apple’s first AI-centric wearable. Bloomberg via Getty Images The AirPods initiative is part of a broader push into AI-powered hardware from Apple.
Apple is also developing an AI-focused pendant equipped with a camera that could be worn on clothing or as a necklace — but probably not like the device that controls space and time in the “Black Mirror” episode “Bête Noire.”
The new products could provide tailwinds during the first full year of John Ternus’ tenure as chief executive officer after he succeeds to the role in September.
The AirPods, code-named B798, were originally targeted for a 2026 release, people familiar with the matter told Bloomberg. The timetable slipped in part because of Apple’s prolonged challenges in artificial-intelligence software development. The company also needed to build visual AI models capable of identifying objects in a user’s environment.
Meta Platforms (META - Free Report) ended the recent trading session at $600.21, demonstrating a +1.13% change from the preceding day's closing price. The stock exceeded the S&P 500, which registered a loss of 0.57% for the day. Meanwhile, the Dow gained 0.64%, and the Nasdaq, a tech-heavy index, lost 1.15%.
Coming into today, shares of the social media company had lost 2.9% in the past month. In that same time, the Computer and Technology sector gained 2.85%, while the S&P 500 gained 2.14%.
Investors will be eagerly watching for the performance of Meta Platforms in its upcoming earnings disclosure. The company is predicted to post an EPS of $7.11, indicating a 0.42% decline compared to the equivalent quarter last year. In the meantime, our current consensus estimate forecasts the revenue to be $60.13 billion, indicating a 26.56% growth compared to the corresponding quarter of the prior year.
For the entire fiscal year, the Zacks Consensus Estimates are projecting earnings of $33.01 per share and a revenue of $253.28 billion, representing changes of +40.53% and +26.03%, respectively, from the prior year.
It's also important for investors to be aware of any recent modifications to analyst estimates for Meta Platforms. These latest adjustments often mirror the shifting dynamics of short-term business patterns. Hence, positive alterations in estimates signify analyst optimism regarding the business and profitability.
Empirical research indicates that these revisions in estimates have a direct correlation with impending stock price performance. To capitalize on this, we've crafted the Zacks Rank, a unique model that incorporates these estimate changes and offers a practical rating system.
The Zacks Rank system ranges from #1 (Strong Buy) to #5 (Strong Sell). It has a remarkable, outside-audited track record of success, with #1 stocks delivering an average annual return of +25% since 1988. Over the past month, the Zacks Consensus EPS estimate has shifted 0.6% downward. Meta Platforms is holding a Zacks Rank of #3 (Hold) right now.
In terms of valuation, Meta Platforms is currently trading at a Forward P/E ratio of 17.98. For comparison, its industry has an average Forward P/E of 18.65, which means Meta Platforms is trading at a discount to the group.
It is also worth noting that META currently has a PEG ratio of 0.93. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. The Internet - Software industry had an average PEG ratio of 1.05 as trading concluded yesterday.
The Internet - Software industry is part of the Computer and Technology sector. This industry, currently bearing a Zacks Industry Rank of 93, finds itself in the top 39% echelons of all 250+ industries.
The Zacks Industry Rank is ordered from best to worst in terms of the average Zacks Rank of the individual companies within each of these sectors. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
You can find more information on all of these metrics, and much more, on Zacks.com.
SummaryCompaniesParents say 12-year-old girl who died by suicide had secret Instagram accountItalian families sue Meta, TikTok over alleged harm to minorsCompanies deny allegations and say they take safeguarding stepsFirst such case in Italy as social media under new scrutiny in EuropeASTI, Italy, June 17 (Reuters) - In the span of just a few months, Irene Roggero Ugues watched her daughter Rossella's behaviour change as social media fed her an increasing stream of self-harm content, before the 12-year-old died by suicide.
Only after Rossella's death did Irene and her husband unlock her devices. They found that she had been using social media far more than they had known, including maintaining a secret Instagram profile called 'Just a dead pers0n' with a zero instead of an o.
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In September, 2023, they said, Rossella began searching for depressive material which mirrored how she felt. Social media algorithms kept pushing it back to her, and just five months later she was dead.
"At some point, it seemed to take on a life of its own, growing until it overwhelmed the cheerful, sociable side of her — the brighter part," Irene told Reuters in a private room at a café in central Asti, her hometown in northern Italy.
Rossella's parents are among a number of families in Italy that have brought a lawsuit against Instagram-and-Facebook-owner Meta (META.O), opens new tab, and its biggest social media rival TikTok. In the first collective action in Italy to directly challenge social media companies and their algorithms, the families are seeking tighter limits on minors' access and greater awareness of risks.
Both companies deny the lawsuit's allegations that their services are harmful to young people, and say they take steps to protect young users by removing harmful content, limiting exposure to risky material and helping families manage children's accounts.
"We know parents worry about the safety of their teens online, which is why we're consistently making changes to help protect teens," a Meta spokesperson said, citing its "Teen Accounts" and built-in safeguards.
"We strongly disagree with these allegations, which ignore our longstanding commitment to supporting young people."
TikTok said its efforts include strict enforcement of guidelines aimed at protecting users' mental and behavioural health, adding that it removes more than 99% of content that violates those rules.
"We also continue to invest in safety measures to diversify recommended content, block potentially harmful searches and connect vulnerable users with support resources," a TikTok spokesperson said, citing local suicide prevention help lines.
Asked specifically about the role that Instagram may have played in Rossella's case, Meta told Reuters that it would not comment directly during the litigation, but that young people’s mental health is shaped by a wide range of factors. The impact of social media platforms depends on how they are used, the safeguards in place to protect users, and the level of parental involvement, it said.
A SUDDEN ILLNESSSpeaking slowly and choosing her words carefully, Irene said Rossella's tragedy unfolded like a sudden, devastating "illness" that left her parents powerless.
Without the algorithm, she says, "the progression of her distress — or psychosis, or whatever it was that I still cannot define — might have unfolded more naturally."
Scrutiny of digital platforms is intensifying across Europe, with Britain announcing plans this week to ban social media for children under 16. In the United States, a U.S. ruling found Meta and Alphabet's Google negligent in designing platforms deemed harmful to young people.
European Union regulators are stepping up enforcement of the Digital Services Act, pressing online platforms to better protect minors and curb harmful content.
"The goal is not to dismiss the benefits of social media, but to remove the technological and marketing mechanisms that make it harmful to the most vulnerable users," said lawyer Stefano Commodo, who is leading the case with the Italian association of parents MOIGE.
Item 1 of 5 Irene Roggero Ugues, whose 12-year-old daughter took her own life in 2024, holds a mobile phone displaying a photograph of her daughter during an interview with Reuters at a cafe in Asti, Italy, May 28, 2026. Roggero Ugues said her daughter had been exposed to self-harm content on social media. REUTERS/Claudia Greco
[1/5]Irene Roggero Ugues, whose 12-year-old daughter took her own life in 2024, holds a mobile phone displaying a photograph of her daughter during an interview with Reuters at a cafe in Asti, Italy,... Purchase Licensing Rights, opens new tab Read more
PARENTS CANNOT KEEP UP: THE LIMITS OF CONTROLParents say safeguards provided by the platforms fall short, noting that children can easily find online tutorials showing how to bypass filters or avoid time limits by switching devices.
"Monitoring social media use is a full-time job. It would require parents to spend all their time doing it, and that is simply unrealistic," said Valentina Muraglie, who sits on the board of Italy's association of large families.
Her own son Antonio put aside his collection of Harry Potter books and replaced reading with scrolling as a teenager. Now in his 20s, he finds it hard to read in depth, which she blames on social media algorithms that sucked away his attention.
"Once he had a phone in his hand, at 16, little by little books started to disappear," she told Reuters. "Within a few years he stopped reading altogether."
The World Health Organization warns that problematic social media use - marked by addiction-like behaviour - is increasing among adolescents and is linked to lower well-being, poor sleep and broader health risks.
Studies published in JAM Paediatrics, a U.S. medical journal, point to measurable differences in brain development among heavy social media users, particularly teenagers whose brains are still developing.
The Italian case argues that social media platforms use reward mechanisms modelled on slot machines to foster dependency, by repeatedly triggering dopamine, a brain chemical linked to pleasure and reward.
"Each 'like' or notification triggers dopamine release, tying users to the platform in a way that resembles addiction," said Tonino Cantelmi, a plaintiffs' advisor and director of the School of Specialisation in Cognitive-Interpersonal Psychotherapy in Rome.
Families bringing the case say brain scan studies of social media users show activity in areas of the brain associated with addiction.
Asked about the scientific evidence on addiction presented in court, spokespeople from Meta and TikTok declined to comment on the litigation, while repeating their earlier comments on the companies' records on mental health.
Some psychologists caution against drawing simple conclusions about the effects of social media on adolescents.
"The healthiest approach when dealing with adolescents is to accept that we are unprepared," Federico Tonioni, head of the Web Psychopathology Centre at Rome's Gemelli hospital, said.
He added he could not conclude that his patients would suffer less in a world without social networks, warning against over-reliance on parental control.
"If there is something dangerous, it is control over children. Young people need to be listened to. Control is not a healthy form of presence. The healthiest distance is trust."
Irene Roggero Ugues said she joined the lawsuit to help ensure that other parents are made aware of risks that she did not learn about until after it was too late to save Rossella.
"We underestimated certain risks and didn't know they existed, but others can still act. There's no point keeping this to myself, and I don't think Rossella would mind."
Reporting by Sara Rossi in Asti, Giselda Vagnoni and Matteo Negri in Rome, additional reporting by Alex Fraser in Asti and Gabriele Pileri in Rome Writing by Giselda Vagnoni Editing by Adam Jourdan and Peter Graff
Our Standards: The Thomson Reuters Trust Principles., opens new tab
A new unit at Meta devoted to artificial intelligence is turning into real-world hell for employees, according to a new report.
At a live-streamed meeting earlier this month reported by Wired, a disgruntled person interrupted speakers to go on an expletive-filled tirade about “being the company’s b—h,” raving that an unnamed Meta AI exec should be told, “he’s a piece of s–t.”
One of the presenters reportedly covered their face with their hands before the meeting’s leaders told everyone to hit the mute button, though rank-and-file workers continued to make comments about it, Wired reported.
Meta leader Mark Zuckerberg is dealing with escalating worker discontent about the company’s pursuit of AI. AP Photo/Alex Brandon The incident highlights growing frustration inside Meta’s Applied AI team, which was formed in March to support the work of AI researchers at Meta Superintelligence Labs – and comes as anxiety has lingered after a brutal round of layoffs targeting 8,000 employees last month.
Wired reported widespread dissatisfaction with how Mark Zuckerberg’s Meta assembled the unit of about 6,500 engineers and product managers, finding employees are fed up with the drudge work they say is required of them to improve AI models.
“It’s literally the gulag,” an unnamed worker told Wired. “You have zero purpose in life all of a sudden, you barely interact with anyone, you just have these tasks every week.”
The tasks reportedly include creating puzzles to test the reliability of Meta and others’ AI models. Meta workers called the work easy compared to the software development they previously did, but complained that it’s menial and say “almost all” employees seem unhappy.
“Most people find the work soul-crushing,” a second employee was quoted as saying.
Another worker called their job “mechanical and not creative,” complaining they’re “not using their full skill set and knowledge.”
Instead of developing social media apps for billions of people, they’ve found themselves slogging through data to prepare it for hundreds of AI scientists to feed to computer chips.
Meta workers describe their new AI work as menial and boring. REUTERS In another sign of employee discontent, more than 1,600 workers reportedly signed a petition calling on Meta stop a recent initiative to monitor US employees’ keyboard and mouse activity in order to generate AI training data.
Meta chief product officer Chris Cox addressed the “difficult” and “brutal” conditions created by the “insanity of this company” during a recent meeting for Instagram employees, according to Wired. He cheered workers’ efforts, which he compared to “running a marathon in the middle of a hailstorm and then, like, your teammate gets replaced and then we’re recording you.”
“It’s like what the f–k,” he reportedly said twice, drawing snickers.
Cox said he and other leaders needed to “get in touch with the company again” and “not be overearnest” about the power of AI, according to Wired.
“It is neither god, nor is it the devil,” he was quoted as saying. “And it’s nowhere near as good as you think it is, and it is nowhere near as bad as you think it is. And it changes every week … and it doesn’t know what day of the week it is.”
Meta leaders have tried to boost employee morale at the tech giant, which laid off 8,000 workers last month. Anadolu via Getty Images Zuckerberg reportedly acknowledged that recent organizational changes had ruffled feathers across the company.
“Given the complexity of these changes, we’ve made mistakes and will almost certainly make more,” he wrote in an internal memo this month, according to Wired. “As we navigate this period, I’m also focused on providing as much stability going forward as possible.”
He reportedly said he would not carry out additional mass layoffs this year, adding he would limit the number of employees per manager. On teams including Applied AI, there were cases of one manager overseeing 50 workers.
Zuckerberg also sought to foster goodwill by saying he would increase budgets for team events.
His memo addressed the situation at the Applied AI team, using the division’s acronym, too.
“Work like [Applied AI] is critical to advancing our models and it lets very talented people contribute to those efforts while we create other roles they can contribute to around Meta over the coming months as well,” he wrote, according to Wired.
Meta declined to comment to Wired and did not immediately respond to a Post request for comment.
ToplineA suite of new artificial intelligence-powered features released by Meta on Monday will allow people to use Facebook as a search engine and content generation tool in such a way that could generate more than $10 billion in annual revenue for Meta if it takes off, according to a Morgan Stanley analyst.
The new Meta AI (Muse Spark) logo.
SOPA Images/LightRocket via Getty Images
Key FactsMeta launched “AI Mode” inside Facebook Search on Monday, which will answer search queries using Meta AI and return answers drawn from public content across Groups and Reels, rather than surfacing a “generic” list of search results, the company said.
The search tool is powered by Muse Spark, the AI model Meta debuted in April and the first major model developed by Meta Superintelligence Labs, which is headed by former Scale AI CEO Alexandr Wang.
If the new tool is able to retain 1 billion users—about a third of Facebook’s monthly active users worldwide—and monetizes just 10% of daily queries, it could easily generate over $10 billion in annual revenue for Meta, according to Morgan Stanley analyst Brian Nowak.
Monday’s rollout also includes new AI-assisted photo and video editing capabilities including collage cutout templates, video transition effects and photo presets that let users change their clothing, hair and accessories in photos.
Meta shares climbed nearly 5% to just short of $595 as of 2:45 p.m. EDT on Monday afternoon, though the stock is still down about 8% year-to-date.
WHAT WE DON’T KNOWHow exactly Meta’s new AI Mode is sourcing its search results. The company says it will “give you answers grounded in what people are saying publicly across our apps like in Groups and Reels,” but doesn’t address exactly how its algorithm is weighing sources or how it will combat misinformation, which has plagued Facebook for years. Forbes has reached out to Meta for more information.
Key backgroundMeta has been embedding its Meta AI assistant across Facebook, Instagram, WhatsApp and Messenger for years, but Monday's launch is the first time the company has positioned AI as a direct replacement for Facebook's own search bar—putting it in more direct competition with Google. It was first reported in October of 2024 that Meta was working to develop its own search engine, but this is the first time that work has landed in front of everyday Facebook users. In the larger artificial intelligence landscape, Meta has fallen behind its peers after the flop of the flagship Llama 4 family of AI models, which caused Meta to largely abandon its open-source AI strategy. The company instead invested $14.3 billion in Scale AI (which included recruiting Wang) and launched its proprietary, closed-source AI system, Muse Spark. Investor sentiment in Meta has lagged despite the company’s massive AI investments, but Nowak has argued the new AI search tool could turn things around.
further readingForbesTech Industry Loses 123,000 Jobs This Year—AI Is The Most Cited Reason For LayoffsBy Mary Whitfill Roeloffs
ForbesMeta Layoffs Underscore The Real Price Of The AI RaceBy Dan Runkevicius
When investors think of the biggest winners of the artificial intelligence (AI) boom, Meta Platforms (META +4.95%) probably doesn't usually come to mind. Not only has the stock suffered this year, with shares falling nearly 10% year to date, but the company is still thought of first as a social media company that sells ads, while the AI label goes to chipmakers and the biggest cloud computing providers.
Yet the irony is that AI may already be doing more for Meta's business than for almost any other company.
Meta's first-quarter revenue, helped by AI, rose 33% year over year to $56.3 billion -- an acceleration from about 24% growth just one quarter earlier.
Here are three reasons Meta is becoming one of the market's best AI stocks for investors to consider.
Image source: Getty Images.
1. AI is already a catalyst for Meta AI is already foundational to Meta's business momentum.
The clearest evidence sits inside the feed. On Instagram, ranking improvements with the help of AI lifted time spent on Reels by 10% during Q1 -- and total video time on Facebook climbed more than 8% globally -- the company's largest quarterly gain in four years.
More time on the platform, of course, means more room for ad inventory. To this end, ad impressions across its apps rose 19% in the quarter, while the average price per ad increased 12%.
And the same AI-driven systems that are improving content ranking across its platforms are also helping each ad work harder. Management said that new ad-ranking models drove a more than 6% jump in conversion rates for one common ad format. And the annual revenue run rate of Meta's value-optimization tools, which steer ad budgets toward customers most likely to buy, has more than doubled over the past year to over $20 billion.
2. A distribution advantage few can match Building good AI is one thing. Getting it in front of people is another -- and here Meta starts with an enormous head start. More than 3.5 billion people use at least one of its apps every day, so a new feature can reach a global audience as it rolls out.
That reach is already on display. After Meta rolled out Muse Spark, the first model from its new Meta Superintelligence Labs, along with a rebuilt version of its Meta AI assistant in April, sessions per user climbed by a double-digit percentage. And more than half a billion people on Facebook and Instagram now watch AI-translated videos every week. Further, business AIs that field customer questions for advertisers handled more than 10 million conversations a week by the time of the first-quarter call, up from about 1 million at the start of the year.
3. Spending backed by profits, not promises But one problem for Meta is the high cost of scaling its AI infrastructure. To support its ambitious compute initiatives, Meta now expects capital expenditures of $125 billion to $145 billion this year -- up from a prior range of $115 billion to $135 billion and nearly double the roughly $72 billion it spent in 2025.
A commitment this large would strain many companies' balance sheets. But Meta is a financial fortress. Its spending is backed up by extraordinarily profitable operations. The social networking specialist's first-quarter operating income rose 30% to $22.9 billion, and it generated $32.2 billion in operating cash flow and $12.4 billion in free cash flow. Additionally, the company ended March with about $81 billion in cash and marketable securities.
In other words, the AI build-out is largely being funded by profits the core business is already generating.
Meta is also trimming its workforce and designing its own chips to fund the push more efficiently.
Today's Change
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4.95
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28.02
Current Price
$
594.47
An attractive bet Still, the boldest part of this growth stock's AI bet has yet to pay off. The new models are meant to power personal and business agents Meta can eventually monetize, but that business is still nascent. Further, Muse Spark's developer API has reportedly been delayed on multiple occasions.
But the reason Meta belongs in the AI conversation arguably isn't its more speculative long-term ambitions to build a superintelligence. Instead, it's that the technology is already lifting the advertising business that funds everything else, even while it waits for its longer-term initiatives to pay off.
"[T]he trend over the last few years seems clear that we are seeing an increasing return on the amount that we can improve engagement for people and value for advertisers," said Meta founder and CEO Mark Zuckerberg during Meta's first-quarter earnings call.
And the other part of the bull case is the stock's valuation. Trading at just 22 times earnings, the stock looks attractive relative to its impressive top-line momentum and considering the attractive economics of the underlying business.
Meta Platforms Inc (NASDAQ:META) is up 5% at $595.57 this afternoon, after the tech concern launched new AI features on social media platform Facebook. META sports a grim 28% year-to-date deficit, with even today's overdue pop facing off with pressure at the 20-day moving average and $600 level.
A frequent flyer on Schaeffer's Quantitative Analyst Rocky White's list of stocks sporting the most active options over the past two weeks, Meta Platforms has ushered in 4.6 million calls and 2.3 million puts during this most recent time frame. The June 720 call and the weekly 6/3 620-strike call have been the most popular over the past 10 days.
Bulls have been circling for longer than that as well. At the International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX), META's 50-day call/put volume ratio of 2.10 ranks in the 88th annual percentile of its annual range.
The equity's premium is affordably priced at the moment, too. This is per the stock's Schaeffer’s Volatility Index (SVI) of 34% that stands in the 34th percentile of its annual range.
Meta Platforms Inc (NASDAQ:META) is up 5% at $595.57 this afternoon, after the tech concern launched new AI features on social media platform Facebook. META sports a grim 28% year-to-date deficit, with even today's overdue pop facing off with pressure at the 20-day moving average and $600 level.
A frequent flyer on Schaeffer's Quantitative Analyst Rocky White's list of stocks sporting the most active options over the past two weeks, Meta Platforms has ushered in 4.6 million calls and 2.3 million puts during this most recent time frame. The June 720 call and the weekly 6/3 620-strike call have been the most popular over the past 10 days.
Bulls have been circling for longer than that as well. At the International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX), META's 50-day call/put volume ratio of 2.10 ranks in the 88th annual percentile of its annual range.
The equity's premium is affordably priced at the moment, too. This is per the stock's Schaeffer’s Volatility Index (SVI) of 34% that stands in the 34th percentile of its annual range.
As Meta tries to catch up in the AI race and boost engagement with its AI bot, the company announced Monday that it’s rolling out new AI features on Facebook that aim to change how users find information, create content, and interact with the platform.
The headline update is “AI Mode,” a new way to search Facebook that uses Meta AI to surface answers pulled from public posts across the platform, including Groups and Reels. Instead of scrolling through search results, users can ask a question in plain language and get a synthesized answer based on what people are actually discussing.
Image Credits:Meta This follows Meta’s quiet launch last month of Forum, a Reddit-style app that includes its own AI “Ask” tab, letting users pose questions and get answers pulled from discussions happening across Facebook Groups.
Both AI Mode and Forum’s Ask tab raise a familiar question: how reliable are answers generated from public posts and group chatter? Because the AI is summarizing content from everyday users rather than vetted sources, there’s a real risk of outdated or misleading information slipping through, a concern that’s already been raised about Google’s own AI Mode on Reddit.
Beyond search, Facebook also added editing tools that let users play around with collage cutouts and transition effects for their video montages. Another new feature is the AI-powered photo presets, allowing users to change up their look with different clothes, hairstyles, and accessories.
Sports fans, for instance, can virtually wear their favorite team jerseys just by tapping the “AI Edit” icon in Stories and choose “Wear It,” or go directly to their profile picture and select “Restyle profile picture with AI” and “Wardrobe.”
Image Credits:Meta These updates add to a growing list of AI features Meta has shipped on Facebook in recent months. In February, the company introduced animated profile pictures that bring still photos to life — adding a wave, or placing a virtual party hat on someone’s head. In March, Meta added an AI feature to Facebook Marketplace that automatically replies to buyer messages on sellers’ behalf.
Most recently, earlier this month, Facebook launched an AI assistant for creators that offers personalized suggestions — including the best times to post and summaries of what audiences are saying in the comments — based on a creator’s content and performance history.
Taken together, the flurry of releases points to a broader strategy: Meta wants Facebook’s AI tools to make the platform stickier and more useful, while also diversifying how it makes money. Alongside these feature rollouts, the company recently launched global subscription plans for Facebook, Instagram, and WhatsApp — starting at $3.99 a month — that unlock additional features, with more AI-related subscription tiers reportedly on the way.
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Meta Platforms (META, Financials) is making a renewed push to establish itself as a major force in artificial intelligence, but investors are increasingly focused on one question: when will the spending translate into meaningful new revenue?
Over the past year, CEO Mark Zuckerberg has invested heavily in AI talent and infrastructure, including a multibillion-dollar effort to strengthen Meta's internal AI development. The launch of Muse Spark, the company's latest proprietary AI model, has helped put Meta back into conversations about the industry's next phase.
The challenge is that investors already see AI improving Meta's advertising business through better recommendations, targeting and engagement. What they want now is evidence that AI can become a standalone growth engine.
That pressure is heightened by Meta's history with Reality Labs, the division behind its metaverse ambitions, which has generated more than $80 billion in cumulative losses. While AI represents a much larger market opportunity, investors are looking for clearer signs of commercialization this time around.
Meta does have advantages. Its AI tools can be distributed across Facebook, Instagram, WhatsApp and its growing portfolio of AI-enabled devices, giving the company access to billions of users. The question is whether that reach can be converted into products and services that generate meaningful revenue beyond advertising.
For investors, the next phase of Meta's AI story is likely to be measured less by technological breakthroughs and more by adoption, monetization and financial returns.
Analyst’s Disclosure: I/we have a beneficial long position in the shares of META, GOOGL either through stock ownership, options, or other derivatives. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.
Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.
Meta Platforms remains a top AI growth story, now trading at only 18x forward P/E after a 14% YTD decline. I reiterate a Strong Buy rating, viewing the recent sell-off as overblown given META's consistent top and bottom-line outperformance. META's robust historical earnings, double beats, and exposure to multi-year AI, data center, and digital ad growth are undervalued by the market.
Meta (META 0.14%) is spending aggressively on AI, but the real question is whether its MTIA chip program can turn rising infrastructure costs into a long-term efficiency advantage. If Meta gains more control over ranking, recommendations, advertising, and generative AI workloads, today's massive bill could become a very different story.
Stock prices used were the market prices of June 8, 2026. The video was published on June 12, 2026.
Rick Orford has positions in Meta Platforms. The Motley Fool has positions in and recommends Meta Platforms. The Motley Fool has a disclosure policy. Rick Orford is an affiliate of The Motley Fool and may be compensated for promoting its services. If you choose to subscribe through their link, they will earn some extra money that supports their channel. Their opinions remain their own and are unaffected by The Motley Fool.
A year after spending over $14 billion to bring in Alexandr Wang and a group of his top Scale AI engineers to revamp its artificial intelligence efforts, Meta is at least back on the map in AI, though it's still far behind OpenAI, Anthropic and Google in the market.
Wang's big accomplishment was the delivery of the Muse Spark AI model in April, marking Meta's first jump into proprietary foundation models and away from a strict adherence to open source, or open weight as it's more commonly called in AI. The group Wang leads — Meta Superintelligence Labs — was established to give the company some sizzle in the hottest corner of the tech industry.
Now that CEO Mark Zuckerberg has his new model, it's on him to make it a financial success. That means showing the company can attract paying users for its AI tools, rather than just using the technology to enhance and bolster its core advertising business.
"Meta needs to provide more proof points of both adoption and commercialization," said Ralph Schackart, an analyst at William Blair who recommends buying the stock. "Investors are looking for Meta to monetize a new AI-first product, beyond the substantial positive impact AI is having on enhancing the advertising models."
Wall Street, at least so far, is unimpressed. Meta's stock is down 18% over the past 12 months, the worst performer in the megacap group, along with Microsoft, which has its own challenges in AI. That's even after Meta reported 33% revenue growth in the first quarter, the fastest rate of expansion for any period since 2021.
For Meta, the problem started with what some industry experts called, in hindsight at least, a strategic blunder. The company jumped into AI with its Llama family of models, offering an open-source approach that allowed developers to freely tinker, while the other big model makers charged for access.
In April of last year, Meta's release of Llama 4 fell flat, failing to captivate developers and leading Zuckerberg to reconsider his company's approach to AI development. Two months later, Zuckerberg shocked the tech world, announcing his company's $14.3 billion investment for roughly half of Scale AI and, more importantly, bringing over Wang and his top lieutenants.
Wang's development and rollout of Muse Spark in April of this year got the ball rolling. Instead of focusing on third-party developers, the new model was designed to easily plug into Meta's apps like Facebook and Instagram as well as AI-powered devices like the Ray-Ban Meta glasses, said Thomas Randall, an analyst at the Info-Tech Research Group. That's on top of the standalone Meta AI app and site.
"There'll be a lot of these frontier model providers that will fundamentally change in lots of different ways, and Meta needs to have a consistent, reliable proprietary model that they themselves own," Randall said. He added that Meta would be "lost" if Zuckerberg didn't open his wallet for Wang and other big-name AI hires over the past year, in what Randall called a "strategic rebuild" for the company.
Randall said Meta hasn't taken the "most optimized route," but at least "I can now see a vision for what they're trying to achieve and what Wang has been trying to achieve," he said.
Since the release of Muse Spark, Meta has unveiled new AI and business-related subscription plans as part of an effort to expand its business beyond online ads. Historically, it hasn't worked. Meta still counts on ads for 98% of revenue.
Schackart said he wants to see "tangible evidence of a growing list of new, AI-first products created by Muse Spark, even if monetization lags." He said that's "what investors are looking for."
The developer problemNo matter how good Wang's model may be, Zuckerberg has a high hill to climb with developers coming off the Llama debacle.
"I think the AI community largely ignores Meta at this point," said Rob May, CEO of the startup Neurometric, which works in the realm of token engineering.
May said it's hard to gauge how much success Wang has had leading MSL, because the company has thus far only released one AI model, which he characterized as a "yawn" among the AI community since the technology is not widely accessible.
Although Meta was heavily courting third-party developers with Llama, May said the company's efforts under Wang seem geared toward internal uses. May said he used to be in regular touch with Meta for Llama-related issues, but now said he "can't get them to return messages."
May admits that it makes sense for Meta to focus on AI for its core ad products, because the company has a $200 billion a year business to protect.
"That company has built the machine," he said.
Andrew Moore, the CEO of enterprise startup Lovelace and former Google Cloud AI chief, said it's not too late for Meta to find a lane.
Meta has focused on making its models more efficient through training techniques. Moore said that could be a major differentiator among developers worried about the rising costs of foundation models.
"If they do proprietary, computationally efficient models, that will be so different from what's happening in this death match between the big guys," Moore said. "They might really benefit."
Moore added that Meta has to show an advantage somewhere, whether it be on cost, latency or other technical nuances that matter to developers.
Krish Subramanian, the CEO of consulting firm KOI AI and former product head at IBM Consulting, said developers are more excited about Google's AI models than what Meta is offering. The appeal of Llama was that it specifically targeted developers wanting open-weight alternative models, while with Muse Spark, Meta has made little effort in that direction, he said.
"The lack of developer trust will come back to hit them if they don't focus on third-party developers," Subramanian said, noting that it took years for Microsoft to regain trust from open-source coders during the early days of Azure.
"To just focus on a walled-garden kind of an ecosystem and ad revenue as the main source of income, they probably will never become the big player," he said.
Buck stops with ZuckA Meta spokesperson pointed to Wang's recent comments about the company's continued support for the open-source ecosystem, and said Meta still plans to offer outside developers access to Muse Spark's underlying technology via an API, as it previously announced.
"We're already testing with some early partners, and look forward to releasing it this month," the spokesperson said.
In addition to the challenges with developers, there's slumping morale. Meta has been slashing jobs throughout the year, and in May fired about 8,000 workers. The cuts spanned departments, including teams working in roles related to trust and safety, which has raised concerns about potential problems that can arise in AI development, according to people familiar with the matter who asked not to be named in order to speak candidly on the subject.
Meta declined to comment about the layoffs. Regarding safety-related issues, the spokesperson pointed to comments from Wang on the matter. He told the Core Memory podcast last month that, "One of the things that is very important to me is safety for these models."
There's also tension at the top of the AI organization. Although the Muse Spark release received high marks internally, there's pressure on Wang along with former GitHub CEO Nat Friedman, who also joined last summer as part of the AI spending spree, to deliver meaningful revenue growth from the model and future releases, sources with knowledge of the matter said.
Meta tech chief Andrew Bosworth, a 20-year company veteran, is a close confidant of Zuckerberg's and someone the CEO could turn to for a bigger role in AI if the newcomers are perceived as failing, the sources said. On the May podcast, Wang dismissed any reported internal conflicts.
Wang has called Muse Spark an "appetizer" for what's to come, and said there will be more powerful, "larger models."
But the AI community is used to a steady stream of updates and new features. That's what they get from OpenAI, Anthropic and Google.
"What I care about is the frequency of the launches and the cadence," said Howard Yu, a business professor at the International Institute for Management Development in Switzerland. "When you launch something, can you build upon that momentum?"
Randall of the Info-Tech Research Group said it's ultimately up to Zuckerberg to determine that strategy and to show "how much of a superpower they are now with all of their products."
Yu agreed.
"This is really about leadership, right?" he said, noting that at tech companies in particular, the CEO defines and articulates the vision, especially when it involves spending billions of dollars.
That Zuckerberg's metaverse and virtual reality ambitions have generated over $80 billion in total losses since late 2020 makes the AI pitch a tougher sell, Yu said.
"He's running out of the space for his credibility to last," Yu said. "I think the virtual reality foray may have burned up a lot of his goodwill in front of investors."
SummaryMeta Platforms remains under pressure due to investor skepticism over rising AI-driven capex and potential equity dilution.META’s AI investments are already driving accelerating ad revenue growth, with Q1 FY26 revenue up 33% YoY and both ad impressions and pricing rising.Custom silicon deployment and new revenue streams like Business Agent, Meta One, and AI glasses offer significant long-term revenue and margin potential for the company.Trading at a forward P/E of 17x and with a 45%+ upside to consensus price targets, META presents a highly attractive risk-reward and I reiterate my buy rating.Looking for a portfolio of ideas like this one? Members of The REIT Forum get exclusive access to our subscriber-only portfolios. Learn More »Sitewide Sale 2026: Get 20% Off J Studios/DigitalVision via Getty Images
Introduction & Investment Thesis Meta (META) continues to remain under pressure. It is currently the second-worst-performing hyperscaler on a YTD basis, as investors have not come to terms with the company’s capex plans.
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Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.
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Trial lawyer Mark Lanier represented the plaintiffs in the landmark social media addiction trial, where Meta CEO Mark Zuckerberg testified. Wally Skalij/Getty Images One morning in February, Mark Lanier woke up after four hours of sleep and started preparing to cross-examine one of the wealthiest people in the world: Mark Zuckerberg.
His team had worked through the night, preparing material for the day ahead that he could then review in the hours before court, all with the help of AI.
Lanier, a nationally known Texas trial lawyer with a reputation for taking on major corporations in high-stakes trials, was representing the plaintiff in a landmark social media addiction case. He said AI allowed his team to do significantly more with the limited hours they had to prep outside the courtroom during the trial, which lasted over a month.
"It's as if I have 10 additional workers who are incredibly well-trained, who know the file inside and out, who work 24 hours a day and don't even need to take a break for the restroom, much less PTO," he told Business Insider, adding, "In the 10 hours I might be working outside of court, I can get 30 hours of work done."
AI in law has been touted both as a major opportunity and a cautionary tale, with many stories of hallucinations and fake citations. While the legal industry grapples with how to use AI, Lanier said it's been a "total game changer" for him.
Lanier won the case against Meta and Google, in which the jury found the companies negligent and ruled they knew their platforms were "dangerous" but failed to warn the plaintiff, who was awarded $6 million. The case was a bellwether for thousands of similar lawsuits brought against social media companies.
Mark Lanier said using AI has transformed his workflow before and during trial. Courtesy of Mark Lanier While Lanier had used the most popular AI products, he said the AI tool he relied on before and during the trial was Boodlebox, calling it "Disney World compared to a swing set in the backyard."
A leader in the education technology space, Boodlebox provides access to major models like ChatGPT, Claude, and Gemini, allowing users to switch between them or compare results. It's also collaborative, allowing Lanier and his team of lawyers to work with the AIs in the same digital workspace.
Lanier worked with Boodlebox to create a custom license that costs him six figures annually and is tailored to his needs.
"We could, in essence, take my brain, take 42 years of my experience, take the things that I have learned and studied and published and not published and incorporate it into the brain that drove my AI queries and results," he said.
He relied on AI before and during the landmark trialLanier is careful when talking specifics about how he deploys his AI. He says it's a matter of "trade craft" and that his firm is "doing some things that nobody else is doing."
One example he gave included taking transcripts from court each day and asking different models to evaluate them. He said AI is also great for finding a more creative or visceral way to describe something in court. He even would feed AI jury notes that came up during deliberations and ask it to evaluate where the jury was in the process.
At the end of court each day, they'd meet in his war room, debrief, and assign tasks to everyone, such as pulling the five most critical documents supporting point A. The team would then break and do much of that work in Boodlebox, allowing him to review what they've put together and how. He said he and his team, which includes several of his daughters, spent thousands of hours on the platform.
While most of Boodlebox's clients are big universities, a company representative told Business Insider that the platform is also exploring more enterprise and law adoption, in part because of its work with Lanier.
Lanier said he doesn't use AI in the way that often gets people into trouble. "I'm not going to say, 'Go do my research and write my brief,'" he said, adding that there was one instance in the case where AI cited something from the record and he knew it wasn't correct.
"It's not unbridled," he said. "You are an important part of the equation."
His advice to other lawyers trying to use AI was to keep up with the developments in the rapidly evolving field. He has an AI team at his firm that sends him a document every Friday with all the developments in AI, typically three pages single-spaced.
"Next trial, I will make what I did last trial look like Fred Flintstone and the Stone Age," he said.
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Kelsey Vlamis You're currently following this author! Want to unfollow? Unsubscribe via the link in your email.
Kelsey is a senior reporter for Business Insider, where she covers business and tech news as well as stories about travel, luxury, and consulting.Her feature story "Disaster at 18,200 feet" received awards from the New York Press Club and the North American Travel Journalists Association, as well as honorable mention from the Society of American Travel Writers. It was also included on Longreads' and Pocket's best of 2022 lists. She has also received an American Journalism Online Award for her coverage on missing and murdered Indigenous people in Wyoming.She's appeared on CBS, NPR, NBC, and other outlets to discuss her work. She previously worked on the world news desk at the BBC in London and received a master's in journalism from Northwestern University.She can be reached by email at [email protected] or via the encrypted-messaging app Signal @kelseyv.21.Popular storiesDisaster on Denali: Inside a 1,000-foot fall on America's highest peakThrifting is more popular than ever. It's also never been worse.Rolex wouldn't service the vintage watch my mom inherited. Watchmakers say it happens all the time.A tiny, invasive bug and the climate crisis are changing how guitars are made, and shifting the course of music historyThe tourism free-for-all is overGovernment-run boarding schools were founded to 'civilize' Native Americans. Hundreds of dead children remain buried in the schoolyard graves.Meet the Texas minister who helps fly dozens of women to New Mexico every month to get abortionsPeople are flocking to Colorado for the great outdoors, but the air pollution is so bad, it's forcing many to stay insideInside Kabul: An aid worker reveals the devastating chaos that erupted during the US exit from Afghanistan
Meta has begun dismantling its $2 billion acquisition of Manus, completing an operational separation from the Chinese-founded AI startup and halting data sharing between the two companies. This is the most concrete step yet toward complying with a divestiture order Beijing issued roughly two months ago on national security grounds.
Meta has cut Manus off from its internal systems, Bloomberg reported, preventing employees from using Manus tools for internal projects as the two companies move toward a full separation.
Meanwhile, according to May reports, the co-founders of Manus have held preliminary discussions about raising approximately $1 billion from outside investors to reclaim the startup from Meta, a move that could pave the way for a Chinese joint venture structure and an eventual listing in Hong Kong, a venue that has seen a surge in AI listings this year for Chinese AI startups like MiniMax and Zhipu.
What was supposed to be a landmark exit for Chinese AI is quickly unraveling. The move underscores Beijing’s determination to retain control over strategically sensitive technology, regardless of a company’s offshore incorporation.
In addition to the forced divestiture, Chinese authorities have since expanded travel restrictions to researchers and executives at private firms, requiring government approval before heading abroad. China is also tightening its grip on foreign capital, with reports indicating that top AI firms, including Moonshot AI, StepFun, and ByteDance, will need government sign-off before accepting U.S. investment, adding another layer to Beijing’s sweeping effort to control its AI sector.
Even as Meta moves to sever ties with Manus, the agentic AI startup has continued to ship new features, rolling out integrations with Similarweb and Shopify.
Manus drew widespread attention with a viral agent demo relocated its staff to Singapore in mid-2025 before announcing a $2 billion acquisition by Meta in December. Chinese regulators moved to scrutinize the transaction earlier this year, citing potential violations of technology export controls and foreign investment rules.
Manus investors, including California-based venture firm Benchmark, have already received their proceeds from the acquisition, while Asian backers, including Tencent, HSG, and ZhenFund, have indicated they will cooperate with the unwinding process, according to the WSJ.
Manus’ Chinese origins with parent company Butterfly Effect drew scrutiny on both sides of the Pacific, with Senator John Cornyn questioning whether American capital should flow to a Chinese-linked firm.
Meta and Manus did not immediately respond to a request for comment outside regular business hours.
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Kate Park is a reporter at TechCrunch, with a focus on technology, startups and venture capital in Asia. She previously was a financial journalist at Mergermarket covering M&A, private equity and venture capital.
A year after Meta's $14.3 billion bet on Alexandr Wang, the company finally has its first proprietary AI model, but remains behind OpenAI, Anthropic and Google. High-profile hires from rival labs made headlines, but so did layoffs, key departures, and a year of widespread internal conflict and low morale.
Meta Platforms (META 0.14%) is dealing with a lot of pressure right now. The social media giant's stock is down more than 13% as of June 10, largely due to mounting regulatory issues and investors' growing skepticism about spending on artificial intelligence (AI). But long-term investors willing to look past recent turbulence may find that Meta is a worthy buy right now, given its low price.
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This isn't meant to discount the very real challenges Meta faces at the moment. Particularly in Europe, regulators are enforcing the Digital Markets Act, which threatens Meta's margins with fines and changes to data policies.
On the spending side, Meta founder and CEO Mark Zuckerberg is committed to his AI infrastructure plan. Capital expenditures are substantial and perhaps hard to justify. After the failure of his Metaverse initiatives, investors and analysts are a bit more skeptical for good reason.
Image source: The Motley Fool.
On the bright side, Meta's business is still incredibly strong. Its advertising platform, spanning Instagram, Facebook, and WhatsApp, reaches nearly half the global population. That level of scale is not easily replicated or replaced. In the first quarter of 2026, advertising revenue exceeded $55 billion, with total Meta revenue reaching $56.3 billion.
If Meta is successful with its AI ambitions, it could further boost the ad business in addition to wider adoption of its Llama models in other industries.
Meta's stock is better priced than some of its peers. Even with a market cap topping $1 trillion, Meta's forward P/E ratio is just 18, and its PEG ratio is 0.82, which suggests the stock may be undervalued right now. Its price-to-sales, price-to-book, and enterprise value-to-revenue ratios are all in the single digits.
No doubt, the company faces significant short- and intermediate-term headwinds, but if its AI strategy pays off and the advertising business continues to flourish, buying now while the stock is down is a solid move.
Catie Hogan has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Meta Platforms. The Motley Fool has a disclosure policy.
Meta President Dina Powell McCormick and CEO of mikeroweWORKS Foundation Mike Rowe join ‘Mornings with Maria' to discuss a new $115 million workforce initiative offering free training and guaranteed skilled-trade jobs.
Meta Platforms has begun dismantling its $2 billion acquisition of Manus, according to a Bloomberg report, as the tech giant moves to comply with Beijing's unprecedented order to unwind the deal.
Meta has completed an operational split, ordering its employees to stop using Manus tools for internal projects while blocking the Singapore-based company's staff from accessing Facebook-parent's internal data systems from this month, Bloomberg reported Thursday, citing people familiar with the matter.
The separation comes as Manus and Meta scramble to heed Beijing's demand to dismantle a deal that has become a test case for how far China will go to safeguard its strategic technology and talent.
Chinese regulators in April ordered the deal to be reversed, an unprecedented move under the country's foreign investment security review mechanism that set in motion the intricate process of unraveling a completed deal, according to Zhonglun law firm.
Beijing has since tightened tech export controls to keep a firmer grip on cross-border transactions, particularly those involving assets in strategic sectors, as the U.S.-China tech race intensifies into a contest over talent, hardware and data.
For U.S. tech firms eyeing Chinese assets, "Chinese-origin AI now carries a kind of reversibility risk that no clever deal structure can price out," said Matthias Hendrichs, a Singapore-based advisor to global AI firms.
For Manus, the problem at the heart of Beijing's objection may not be resolvable, Hendrichs added. "Once another company's engineers have been inside your stack, you can delete the repository, but you can't make them unsee what they've seen."
Once celebrated as a breakthrough for Chinese AI startups taking on American rivals, Manus has become a cautionary tale for entrepreneurs looking to shed their Chinese image by relocating to countries such as Singapore.
"The unwind may be messy," said Han Shen Lin, China managing director at The Asia Group. Beijing has sent a message to its tech sector that the so-called "Singapore washing" has limits, he said, and a lesson to Washington that shining a light on ownership structures may be just as effective as any prohibition.
Manus, with its roots in China, relocated its headquarters and core teams to Singapore last year, before Meta announced to acquire the agentic AI startup for $2 billion in December, triggering a months-long probe involving tech export controls.
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Earlier this month, Beijing issued sweeping new rules tightening control of overseas deals involving Chinese investors, technology, data and on national security grounds.
The rules come as Beijing and Washington race to tighten their grip on AI. Chinese regulators have reportedly instructed firms, including Moonshot AI, StepFun and ByteDance to reject U.S. investment without explicit government approval, while Washington recently broadened its AI chip export controls to China-headquartered firms globally.
The rules extend Beijing's reach to deals in markets beyond mainland China, including Taiwan, and give it the power to punish foreign firms whose home countries restrict Chinese investment.
The new outbound investment directives target deals such Manus — a high-profile move that suggested a leading Chinese AI firm was turning away from the domestic market, an example Beijing didn't want others to follow, said Tilly Zhang, an industrial policy analyst at Gavekal Dragonomics.
Beijing's new framework essentially gives the state "a retroactive and forward-looking chokehold" on outbound capital, Han said. "If Chinese money touched a deal ... Beijing can now assert jurisdiction over the exit, the restructuring, or the reinvestment."
The framework, which takes effect July 1, provides for the first time a comprehensive and formalized legal basis for China to force the unwinding of completed overseas transactions. It specifically bans cross-border talent transfers in sensitive sectors without approval.
Meta Platforms (META, Financials) has reportedly started unwinding its $2 billion acquisition of Manus after Chinese regulators ordered the deal to be reversed.
According to Bloomberg, Meta has separated operations from Manus, stopped employees from using Manus tools for internal work and blocked Manus staff from accessing Meta's internal data systems.
The move shows how difficult cross-border AI deals are becoming as the U.S. and China compete over technology, data and talent. Beijing appears determined to keep closer control over strategic AI assets, even when companies relocate outside mainland China.
For Meta, the unwind creates another complication in its AI strategy. The company has been spending heavily to strengthen its AI tools, infrastructure and talent base, but this deal now looks caught in a bigger geopolitical fight.
For investors, the key issue is not just the $2 billion price tag. It is whether tighter China rules make future AI acquisitions harder for large U.S. technology companies.
Facebook and Instagram were suffering from widespread outages on Friday morning. Users of the Meta-owned social media sites reported issues with accessing the platforms, according to the third-party outage-tracking website DownDetector.com.
Meta Platforms (NASDAQ:META | META Price Prediction) just delivered Q1 revenue of $56.31 billion, up 33% YoY, and EPS of $10.44 against a $6.66 consensus.
SpaceX (SPCX) is finally off to the races and publicly trading after its historic IPO on Friday, June 12. Nasdaq (NDAQ) President Nelson Griggs sits down with Market Catalysts Host Julie Hyman and Yahoo Finance Executive Editor Brian Sozzi to discuss the lessons his company has learned from Facebook's — now Meta Platforms (META) — own IPO in 2012.
Meta CEO Mark Zuckerberg has said that the social media giant has made mistakes on its AI transformation, in an internal memo seen by Reuters.
