Meta Platform (META) Signs Multibillion-Dollar AI Chip Agreement With Google

Meta Platforms Inc. (NASDAQ:META) is one of the 15 best stocks to invest in according to billionaires.

On February 27, Meta Platforms Inc. (NASDAQ:META) signed an agreement to lease Google’s (GOOGL) AI chips, called tensor processing units, for developing new AI models, according to The Information’s Amir Efrati and Anissa Gardizy, who cited a source familiar with the discussions. The agreement spans multiple years and is reportedly worth billions of dollars.

On February 10, Citizens analyst Andrew Boone maintained his Market Outperform rating for Meta Platforms Inc. (NASDAQ:META), with a  $900 price target. The rating was primarily fueled by massive engagement on Instagram.

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According to Boone, Instagram’s global time spent surged 19.2% year-over-year in January, consistently outpacing user growth, which saw a modest 6% increase. In the U.S., engagement rose 16.5% despite just 2% growth in monthly active users. This trend suggests Meta is successfully squeezing more value and time out of its existing user base.

Meta Platforms Inc. (NASDAQ:META) operates various communication and social media platforms that connect users worldwide. Its business operates through two segments. The first is called Family of Apps (FoA), which runs Facebook, WhatsApp, Threads, Instagram, and Messenger. The second is the futuristic Reality Labs (RL), which includes the metaverse and VR/AR hardware.

While we acknowledge the potential of META as an investment, we believe certain AI stocks offer greater upside potential and carry less downside risk. If you’re looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on the best short-term AI stock.