Meta Platforms and Microsoft are investing in AI, but Microsoft is better positioned for growth.

From Zacks Investment Research: 2025-05-15 16:02:00

Meta Platforms and Microsoft are investing heavily in artificial intelligence (AI) infrastructure and applications, with Meta planning to invest up to $72 billion and Microsoft increasing capital expenditures to support cloud growth and AI infrastructure. The global AI infrastructure market is expected to surpass $200 billion by 2028, offering a massive opportunity for both companies. Meta Platforms focuses on improving ad targeting with AI, while Microsoft has over 60,000 Azure AI customers and strong adoption of AI applications like Copilot. META shares have outperformed Microsoft year to date, but Microsoft is better positioned for growth in AI services.

The Zacks Consensus Estimate for META’s 2025 earnings is $25.52 per share, up 2.7% in the past 30 days, while Microsoft’s estimate for fiscal 2025 is $13.30 per share, up 2% in the same period. Both companies have beaten earnings estimates consistently, with Meta Platforms showing a higher average surprise than Microsoft. In terms of valuation, Meta Platforms is cheaper than Microsoft based on forward 12-month Price/Sales ratios. Microsoft is a stronger pick with a Zacks Rank #2 (Buy) compared to Meta Platforms’ Zacks Rank #3 (Hold).



Read more at Zacks Investment Research: Meta Platforms vs. Microsoft: Which AI Superpower is a Better Buy? – May 15, 2025