When you think of Meta (META), you might associate it with Facebook, Instagram, or even the metaverse. However, the company has emerged as a contender in artificial intelligence alongside giants like OpenAI, Microsoft (MSFT), and Google (GOOG, GOOGL). Meta's AI success largely stems from its Llama family of models, which it is integrating into its various social platforms, including a dedicated AI assistant for Facebook, Instagram, and WhatsApp. Many businesses, such as Accenture (ACN), DoorDash (DASH), and Goldman Sachs (GS), are leveraging Llama to develop their own AI software. In addition to implementing AI in its products, Meta offers its Llama models as open-source software, allowing developers to freely download and enhance it, contrasting with OpenAI's closed-source approach for its GPT models. This strategy has positioned Meta as a strong player in the AI landscape, posing a potential challenge to its competitors. Gene Munster, managing partner at Deepwater Asset Management, noted that the existence of Llama might have diverted some developers from seeking alternatives like OpenAI's GPT or Google’s Gemini. Meta's AI strategy is designed to yield short- and long-term benefits.

By applying Llama to its products, the company enhances its offerings while demonstrating the software’s practical applications. Meta’s CEO Mark Zuckerberg highlighted the potential for revenue generation from deals with companies like Microsoft, Amazon, or Google that wish to resell these services. Meta’s stock has surged 85% in the last year, far outperforming Microsoft (25%) and Google (18%). Analysts believe the company’s shares are attractively priced, and the prospects of AI-enhanced products could further boost its market position. Despite Meta's advantages, its rivals are also adapting. OpenAI and Anthropic benefit from funding partnerships with Microsoft and Amazon, respectively, while Google has the advantage of integrating its Gemini platform into millions of Android devices. Users may find it more convenient to access AI assistants embedded in their devices rather than through standalone apps like those from Meta. Nevertheless, Meta can tap into its vast user base of over 3. 27 billion daily active users across its platforms, creating significant opportunities for growth. For more information or to connect with Daniel Howley, you can reach out via email or follow him on Twitter.