Meta Platforms (META +3.69%) is playing catch-up in the AI model space. The company’s CEO, Mark Zuckerberg, is determined to redeem the company after its predecessor, Llama 4, fell short of expectations. Meta went on to create its Superintelligence Labs and recruited AI wunderkind Alexandr Wang to run the organization as Chief AI Officer.
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Meta made a splash this week with the debut of Muse Spark, an ambitious AI model that should be on par with leading competitors OpenAI, Anthropic, and Alphabet‘s Google. Muse Spark is the product of a multibillion-dollar effort from Meta.
The initial reaction to Muse Spark has been positive, and Meta’s stock has popped 9%. Shares of Meta are down 14% over the past six months and nearly 5% in 2026.
Image source: Getty Images.
Meta is offering third-party developers access to Muse Spark via an application programming interface (API). The hope is that Muse Spark helps advertisers target audiences more effectively.
The cost of catching top competitors in AI is the biggest risk. Meta anticipates capital expenditures of up to $135 billion in 2026. This puts short-term pressure on the balance sheet, but could pay off in the long run if Zuckerberg and Wang deliver results that compete with the top players.
Investors in Meta should be patient as the company implements its new AI model into its gigantic advertising business. The real upside potential won’t likely be recognized for a few more quarters.
Catie Hogan has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Alphabet and Meta Platforms. The Motley Fool has a disclosure policy.
