Mark Zuckerberg has a bold vision for Meta’s chatbot. Is the stock a buy based on what we’ve seen so far?

Meta platforms (META 1.60%) has billions of active users across all its platforms. Between WhatsApp, Facebook, Instagram and Messenger, it has a huge user base that it can test new products and services on. Its Threads platform grew to more than 100 million users in less than five days after launching last year, largely because it was incredibly easy for Instagram users to try it out.

The company looks to once again be using its users to help them ride the next big wave: artificial intelligence (AI). CEO Mark Zuckerberg sees it as a huge opportunity, and while Meta may be a bit late to the game, he has some ambitious goals ahead. And if it hits them, that could make an already hot stock even better.

Will Meta’s AI become greater than ChatGPT?

The AI ​​chatbot ChatGPT has been publicly available since November 2022 and has generated a lot of excitement around AI and how it can transform the way people do their jobs and potentially even eliminate the need for some jobs. There are reportedly 200 million monthly active users on ChatGPT. But Zuckerberg thinks Meta’s AI can beat that — before the end of the year.

Meta recently released a new AI model, Llama 3.1, which it says outperforms the latest GPT-4o and Claude 3.5 Sonnet on several benchmarks. The model is open source — meaning anyone can see and update the code — which could attract many developers and help improve the model over time. AI will be built into the company’s apps and even VR headsets, making it easier for Meta’s large user base to get exposed to it and potentially become regular users.

Considering the billions of users Meta apps have, surpassing ChatGPT in user count may not be that difficult, even if the goal is for it to happen before the end of the year.

Why this could be a big win for the Meta

I wouldn’t be surprised if Meta can get a lot of people to use its AI platform, especially if it’s easily accessible in WhatsApp, Facebook and other popular apps. The real test, though, will be how long people use it and whether it lures them away from ChatGPT. While people may accidentally click a button to launch Meta AI or simply test it to see what it does, and that will certainly increase the number of users for it to really be a significant game changer for business, you’ll need to show that it’s better than ChatGPT, or that it can at least be a viable alternative. It might take a little longer to prove.

If that happens and users really see value in the Meta chatbot, the company could find ways to monetize the product. ChatGPT, for example, offers a subscription service to a more advanced version of its chatbot. MicrosoftHis copilot is available in his Office software and for an additional subscription price.

Additionally, if Meta’s AI can improve the user experience within its existing apps, leading to higher usage and more users overall, that could attract even more advertising dollars.

The meta has already grown at an impressive pace, and an AI boost could generate even more optimism around the stock. For the three-month period ended June 30, Meta’s sales rose 22% to $39 billion. And its net income rose 73% to $13.5 billion. Not only did its average price per ad increase 10% during the quarter, but the number of ad impressions across its family of apps grew at a similar rate. The stock is up about 40% this year.

Is Meta Platforms Stock a Buy?

Meta’s business has been doing well, but I’d wait to buy the stock until it can demonstrate that its new AI assistant can really be the success that Zuckerberg envisions. There are a lot of big tech companies launching their own chatbots and it might not be easy to lure users from one to the other.

However, if Meta’s AI proves to be able to win over users, then it could make the tech stock an unusual buy, as it could accelerate the company’s already strong growth rate.