What's the best artificial intelligence (AI) stock to buy in early 2026? Several top contenders come to mind immediately. After Meta Platforms' (META 2.45%) stellar fourth-quarter update last week, it's definitely on the short list -- and perhaps deserves the top spot. Here are seven reasons why Meta arguably is the best AI stock to buy right now.
1. AI is transforming Meta's core ad business
Meta remains a digital advertising juggernaut. Its ad revenue soared 24% year over year in Q4 to $58.1 billion. And AI is transforming the company's core ad business, boosting revenue and profits.
In Q4, Meta changed the architecture of the GEM model it uses for ad ranking and doubled the number of GPUs used to train the AI model. The results were impressive: a 3.5% increase in ad clicks on Facebook, with a 1%+ increase in ad conversions on Instagram. The company expects further performance gains going forward.
Image source: Getty Images.
2. Agentic coding is turbocharging Meta's productivity
The speed of software development is critical to Meta's growth story. Thanks to agentic coding -- the use of agentic AI to write, test, and debug software with minimal human intervention -- the company's output per engineer has jumped 30% since the beginning of 2025. Meta's productivity improvement is even more impressive with power users, with AI coding tools increasing their output by a staggering 80% year over year.
There's even better news for Meta's shareholders. CFO Susan Li said in the Q4 earnings call, "We expect this growth to accelerate through the next half [of 2026]."
3. Smart glasses could be the biggest device since smartphones
Sales of Meta's AI-powered smart glasses more than tripled in 2025. This growth could be only the tip of the iceberg.
Meta CEO Mark Zuckerberg said in the Q4 update, "I think that we're at a moment similar to when smartphones arrived, and it was clearly only a matter of time until all those flip phones became smartphones." He noted that billions of people worldwide currently wear glasses and added, "It's hard to imagine a world in several years where most glasses that people wear aren't AI glasses."
4. Meta's personal superintelligence is poised to be a game changer
Some people might have rolled their eyes when Zuckerberg announced Meta's commitment last year to developing AI superintelligence. However, the company's vision to build personal superintelligence is poised to be a game changer.
Zuckerberg promised in the Q4 earnings call, "This is going to be a big year for delivering personal superintelligence." He said that Meta is already beginning to see the potential of AI that understands users' history, interests, content, and relationships.
NASDAQ: META
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5. Meta Compute should pay off handsomely
AI infrastructure is a significant constraint for any company developing AI systems. That's why Meta established Meta Compute a few weeks ago. The goal of this new division will be to invest in creating custom silicon and energy sources needed for AI.
Importantly, Meta is also architecting its systems to support any type of chip. Its Andromeda ad retrieval engine can now run on Nvidia (NVDA 1.21%) or AMD (AMD 3.22%) GPUs, as well as on Meta's internally developed MTIA accelerators. Meta Compute should pay off handsomely over time by reducing Meta's reliance on third-party chips and lowering energy costs.
6. Agentic AI for businesses is already a winner for Meta
We've already mentioned how agentic AI in coding is helping Meta increase productivity. The technology is also enabling the company to make more B2B revenue.
Meta's business AIs on its WhatsApp messaging platform now support over 1 million weekly conversations between customers and businesses in Mexico and the Philippines. The company plans to expand the availability of these AI agents to additional markets in 2026, while further beefing up their capabilities.
7. Reality Labs' losses should decline
If it weren't for Reality Labs (Meta's segment focused on augmented and virtual reality) posting a $6 billion loss in Q3, Meta's profits would have been 24% higher. Investors who have grumbled about the ongoing hemorrhaging of money with Reality Labs received good news in Meta's Q4 update. While the segment's losses in 2026 will probably be similar to those in 2025, Meta expects the bottom line to improve going forward.
Is this merely an idle promise? I don't think so. Meta is now focusing most of its Reality Labs investments on AI glasses and wearables. I expect these investments to deliver tremendous returns over time.
