Meta Platforms: A Wager on Algorithms & Hope

2025. The year Meta Platforms, formerly known as that place where Aunt Mildred shares conspiracy theories and cat pictures, decided it wanted to be… clever. They started throwing money at Artificial Intelligence with the enthusiasm of a dragon guarding its hoard, doubled down on this ‘Llama’ business (more on that later¹), and rearranged the office furniture so often you’d think they were running a perpetual game of organisational chess. Investors, bless their optimistic hearts, mostly nodded along, even as profit margins started looking a bit…thin.

Now, as we stumble into 2026, the question isn’t if Meta takes AI seriously. The real question is whether they can turn all this digital tinkering into something that doesn’t resemble a very expensive hobby. It’s a bit like asking a wizard if they can actually do magic, or if they just have a nice hat.

What the Market Already Knows (or Thinks It Does)

Much of the Meta narrative is, shall we say, well-trodden ground. Everyone knows they’ve committed a frankly alarming amount of coin to computing power and data centres – enough to power a small country, probably. They’re also taking a different tack than some of their competitors, pushing this ‘Llama’ thing as open-source. It’s a bit like giving away the recipe for a powerful potion, hoping someone else will brew it for you, and then taking a small commission. And they’ve reorganised the AI teams under something called ‘Superintelligence Labs’ – which sounds suspiciously like a Bond villain’s lair.

None of this is exactly breaking news. The tricky bit is figuring out if all this translates into actual, sustainable profits, or just a larger electricity bill.

The Bull Case: Reasons to Hope (and Maybe Invest)

The argument for owning Meta stock boils down to execution, not hype. It’s about whether they can actually do the thing, not just talk about it.

First, AI could genuinely improve their advertising business. Better targeting, smarter ranking, and more effective creative tools could boost engagement and improve return on ad spend. If Meta’s AI systems can make ads more efficient, revenue could grow without bombarding users with even more adverts. They’ve already seen a 26% revenue increase in the first nine months of 2025, which is… encouraging. Though correlation, as the wizards of statistics like to point out, is not causation. Perhaps people are simply buying more things.²

Second, this ‘Llama’ thing. By positioning it as open infrastructure, Meta is hoping to attract developers and enterprises into its ecosystem, essentially outsourcing the cost of development. It’s a bit like inviting everyone to contribute to a giant, communal garden, and then claiming ownership of the resulting harvest. If Llama becomes the default layer for AI development, Meta benefits indirectly.

Third, their scale is unmatched. With billions of users across Facebook, Instagram, and WhatsApp, they can deploy AI features, gather feedback, and iterate faster than almost anyone else. If their restructured AI organisation actually delivers on speed, that feedback loop could become a powerful advantage.

If all these pieces come together, Meta’s long-term earnings power could improve. Or it could all go horribly wrong. The universe is, after all, a fundamentally chaotic place.

The Risk Case: What Could Go Wrong (and Probably Will)

There are potential upsides, yes, but the downside risks are significant. Meta doesn’t need to fail for the stock to disappoint; it just needs to execute slower than investors expect. And history, sadly, is littered with examples of companies that promised the moon and delivered a slightly dented rock.

The most obvious risk is that AI spending stays elevated longer than anticipated. Building and running large-scale models is expensive, and the payoff may be delayed. If margins remain under pressure, sentiment could sour quickly.

Can they turn AI from a cost centre into a profit amplifier? It’s a simple question, really. Though, as any philosopher will tell you, simple questions often have the most complicated answers.

Investors should watch for specific signals:

Evidence that AI-driven ad improvements are lifting monetization efficiency.
Faster rollout of AI features across Meta’s apps.
Signs of operating leverage reemerging, even as AI investment continues.
Stability within Meta’s AI organisation, with fewer restructurings and a more precise execution rhythm.

These indicators matter far more than flashy model releases or benchmark scores. It’s about doing the thing, not just talking about it.

So, is Meta Stock a Buy?

Meta stock isn’t a bet on AI hype; it’s a bet on execution. It’s about whether they can actually deliver on their promises.

For long-term investors comfortable with near-term volatility, Meta can make sense, provided they believe the company can convert its scale, infrastructure, and ecosystem into tangible returns over the next few years.

For others who need clearer margin expansion or faster payback, it might be better to wait on the sidelines for clearer signs. The market, after all, is a patient beast.

Either way, it’s a stock to follow closely in 2026. And perhaps have a small wager on it. Just for fun, of course.

2026-01-18 01:32

What the Market Already Knows (or Thinks It Does)

The Bull Case: Reasons to Hope (and Maybe Invest)

The Risk Case: What Could Go Wrong (and Probably Will)

So, is Meta Stock a Buy?

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