Meta Platforms and Microsoft are both heavily investing in AI infrastructure, but Meta outperformed Microsoft.

From Nasdaq: 2025-05-15 15:00:00

Meta Platforms and Microsoft are both investing heavily in artificial intelligence (AI) infrastructure and applications, with Meta planning to invest $64-72 billion and Microsoft increasing capital expenditures to support growth in cloud offerings and AI infrastructure. The global AI infrastructure market is expected to exceed $200 billion by 2028, presenting a significant opportunity for both companies.

In terms of stock performance, Meta Platforms has outperformed Microsoft year to date, with META shares appreciating 12.5% compared to Microsoft’s 7.5% return. However, Meta Platforms shares were negatively impacted by higher tariffs announced on Liberation Day. Both companies have seen positive earnings estimate revisions, with Meta Platforms’ 2025 earnings expected to increase by 6.96% over fiscal 2024 and Microsoft’s expected to grow by 12.71%.

Meta Platforms is leveraging AI to improve advertisers’ return on ad spending, with its AI-powered machine learning system Andromeda driving better targeting and audience engagement. Microsoft, on the other hand, has seen significant adoption of its Azure AI services, GitHub Copilot, and Phi small language models. Both companies have consistently beaten earnings estimates, with Meta Platforms showing an average surprise of 17.3% compared to Microsoft’s 5.21%.

While both companies are overvalued, with a Value Score of D, Meta Platforms shares are trading at a lower forward 12-month Price/Sales ratio of 8.57X compared to Microsoft’s 10.9X. Microsoft is better positioned due to strong adoption of Copilot, Azure AI services, and a rise in AI Copilot business. Currently, Microsoft has a Zacks Rank #2 (Buy) compared to Meta Platforms’ Zacks Rank #3 (Hold).

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To explore these high-growth opportunities further and access the latest recommendations from Zacks Investment Research, download the free report on 7 Best Stocks for the Next 30 Days. Additionally, for a free stock analysis report on Microsoft Corporation (MSFT) and Meta Platforms, Inc. (META), visit the provided links.



Read more at Nasdaq: Meta Platforms vs. Microsoft: Which AI Superpower is a Better Buy?