Meta Platforms, Inc. (META) Stock Analysis

Meta’s primary competitive advantage is its unparalleled global user base, with 3.6 billion daily active people across Facebook, Instagram, WhatsApp, and Messenger as of year-end 2025. This scale creates powerful network effects: users and advertisers gravitate to platforms where their peers and target audiences already are, reinforcing Meta’s dominance. For comparison, TikTok’s estimated global user base is less than half Meta’s, and Snap’s is under 500 million.

Meta’s advertising platform is another core strength. Its AI-driven ad targeting and measurement capabilities, underpinned by vast proprietary data, deliver high ROI for marketers. In 2025, advertising accounted for 98% of Meta’s $201 billion revenue, with gross margins above 80%. Google remains a formidable rival in digital ads, but Meta’s social graph and engagement data provide unique targeting advantages, especially for brand and direct-response campaigns.

Switching costs are high for both users and advertisers due to entrenched social connections, content history, and business tools. Meta’s ongoing investment in AI and infrastructure—$72 billion in 2025 capex—supports product innovation and operational efficiency at a scale few can match.

However, Meta faces rising competition from TikTok in short-form video, regulatory headwinds, and shifting user preferences among younger demographics. While its network effects and data scale remain durable, continued innovation and adaptation are required to sustain its edge.