Meta shares jumped after the company unveiled Muse, a personal AI agent for everyday consumer tasks, addressing investor doubts about the payoff from its AI spending. Mizuho analyst Lloyd Walmsley called the launch a step toward proving AI's return on investment, while warning it could pressure Alphabet's stock.
Meta shares rose 4.6% toward a seven-week high in premarket trading Wednesday after the company introduced Muse, a personal AI agent built for everyday consumers. The stock was the best performer in the S&P 500 and Nasdaq 100 ahead of the open, according to FactSet data.
Muse targets everyday tasks, not enterprise work
Meta positioned Muse as a tool meant to work on a person's behalf, handling tasks like booking trips, shopping, and replying to emails. Anthropic, OpenAI and other companies have built their own AI agents, but those tools mostly target complex work such as coding or enterprise use, unlike Muse's consumer focus. Muse is available as a free app with usage limits, and Meta offers paid subscriptions for power users.
Meta CEO Mark Zuckerberg said in a statement on Tuesday: "Muse is built to help deliver personal superintelligence to everyone over time."
Analysts see an answer to the AI spending question
Mizuho analyst Lloyd Walmsley wrote that Muse marks the start of a substantial new product cycle that the market has not yet priced into the stock. He described the launch as a step toward proving the return on Meta's AI investment, which he named as the biggest hurdle for long-term investors.
The company expects to spend between $130 billion and $145 billion this year, most of it directed toward AI programs. Investors were unimpressed by Meta's AI progress after its second-quarter earnings report in July, when the company also issued weak guidance for the current quarter. Selling excess AI computing capacity could become another multibillion-dollar revenue source for Meta, according to analysts, and Zuckerberg called personal agents the foundation for future products and revenue lines during the July earnings call.
Alphabet faces the biggest spillover risk
Walmsley warned that Muse's release could unsettle Alphabet's stock, since it may renew concerns over delays to the company's Gemini AI models and how AI is reshaping Google Search. He is bullish on both Meta and Alphabet.
The analyst said he was less worried about disruption to Amazon's advertising business, and he holds the equivalent of a buy rating on the stock. Even so, Alphabet shares fell 2.2% and Amazon shares dropped 1.6% in Wednesday's premarket trading.
Source: MarketWatch
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