Meta Platforms (META), the social network giant, has entered into a licensing agreement with one of the prominent text-to-image generative AI companies, Midjourney. The deal gives Meta access to Midjourney’s image technology for future models and products. In addition, Meta said the agreement will link the research teams of both companies to share knowledge and improve product design. During Friday’s trading session, Meta shares rose over 2%.
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Meta Targets Creative Edge in the AI Race
The move reflects Meta’s goal to make its AI services stand out in a crowded market. The company has been working to catch up with competitors like OpenAI and Google (GOOG), which have gained strong positions in the generative AI space. Therefore, focusing on image quality may help Meta differentiate its tools and expand use across social media platforms and virtual reality services.
Midjourney is best known for software that creates pictures from text prompts. The company offers its service through a subscription model and has built a loyal user base. By partnering with Midjourney, Meta could integrate advanced image tools into products such as Instagram, WhatsApp, and its AR and VR platforms. This could make creative features more attractive to users and potentially support new ad formats over time.
Meta’s Chief AI Officer Alexandr Wang said in a post on X that the company plans to combine top talent, a strong compute roadmap, and partnerships with leading firms to deliver high-quality products. While financial terms were not shared, the agreement could help Meta strengthen engagement across its apps.
Is META Stock a Buy?
On the Street, Meta Platforms boasts a Strong Buy consensus, with an average META stock price target of $873.29. This implies a 15.70% upside from the current price.
Meta stock has gained attention this year as investors watch how AI spending shapes growth. According to TipRanks, analysts currently rate the stock as a Strong Buy, with an average price target suggesting upside potential from current levels. As competition in AI grows, partnerships like this may play a key role in product development and revenue plans.