News about TikTok and an AI update helped lift the social media stock.
Shares of Meta Platforms (META 2.20%) were gaining today. The social media giant seemed to benefit from expected legislation against TikTok and launched the newest version of its Llama large language model (LLM), updating its Meta AI assistant as well.
As of 1:24 p.m. ET, the stock was up 2% on the news after climbing as much as 3.7% earlier in the session.
Image source: Getty Images.
Meta gains an advantage
For several months now, social media stocks like Meta have moved on news about a possible ban or forced divestiture of TikTok, the popular China-based social media app, but that legislation now looks like more of a reality than ever before.
House Speaker Mike Johnson is reportedly planning to include legislation in a bill to give aid to Ukraine and Israel that would ban TikTok or force owner ByteDance to sell its U.S. ownership.
Separately, Meta also introduced several new artificial intelligence (AI) products, showing it will remain a contender in generative AI. The company released Llama 3, its latest LLM, and an image generator that updates images in real time. Those tools will be included in Meta AI, its free AI assistant available in Facebook, Instagram, WhatsApp, and Messenger.
Can Meta keep gaining?
The TikTok development is complicated and the issue could spend years in the courts even if a ban is passed, but Meta could certainly see some benefit from legislation as TikTok is arguably its closest competitor now. Meta has invested heavily in Reels, its TikTok competitor, to increase engagement on platforms like Facebook and Instagram.
Additionally, any improvement to its AI capabilities is likely to elicit cheers from investors. Though Meta doesn’t have a direct way to monetize its generative AI efforts, if they encourage users to spend more time on the platform, then that should increase ad revenue and improve its competitive position. Expect Meta to continue to invest in AI as the new technology is only just starting.
Randi Zuckerberg, a former director of market development and spokeswoman for Facebook and sister to Meta Platforms CEO Mark Zuckerberg, is a member of The Motley Fool’s board of directors. Jeremy Bowman has positions in Meta Platforms. The Motley Fool has positions in and recommends Meta Platforms. The Motley Fool has a disclosure policy.
