Morgan Stanley Backs Meta (META.US): Muse Ecosystem Continues to Expand, VR Glasses Expected to Become a New Growth Point in 2027

According to Zhitong Finance APP, the latest research report from Morgan Stanley indicates that the Muse personal AI assistant ecosystem of Meta Platforms (META.US) continues to grow and could unlock new growth opportunities through new products such as lighter VR glasses. The bank maintains an "Overweight" rating on Meta with a target price of $775, and continues to list it as a top pick.

Muse Ecosystem Expansion: Retail Giants Like Walmart Join

The report notes that Meta has recently announced Muse partnerships with several retailers, including Walmart, Best Buy, Dick's Sporting Goods, and Gap. Morgan Stanley believes these "connectors" help eliminate friction in users' shopping and purchasing processes, ultimately unlocking approximately a $30 trillion total addressable market (TAM) in consumer agency spending.

Morgan Stanley points out that although transaction commission rates are expected to be extremely low or even negligible, Meta is focusing on building and expanding an ecosystem of users, engagement, and commercial behaviors to enable long-term monetization. The report also notes that keeping low commissions will put pressure on competing agent products, and Google and other private companies may need to follow suit or risk losing market share. Furthermore, Walmart’s participation may prompt Amazon to respond similarly to prevent long-term share losses.

Voice and Wearables: Muse Voice Launch Imminent, Full Integration with AR Glasses

In terms of voice and wearable devices, Meta showcased the new voice feature, Muse Voice, expected to launch in the coming weeks. This feature will enable Muse to respond to users in a personalized, customized, and conversational manner. At the same time, Muse will be fully integrated into Meta’s latest AR glasses (across all brands), allowing users to interact with Muse via their glasses without taking out their phone. This is expected to drive more adoption, engagement, new use cases, and unlock further long-term business opportunities.

Expansion Continues: Muse to Enter More Markets, Integrates with Apple Computers, Own Dedicated Email Coming Soon

Meta expects to launch Muse in more countries outside the US and Canada soon and revealed that Muse is now integrated into Apple computers. Muse will also soon have its own email address, making it an even more powerful assistant, and could gradually transition user activity from Gmail to Meta’s mail/chat system in the long term.

New Hardware Moves: Muse Charm and Lightweight VR Glasses

Meta also unveiled a handheld/keychain-style device called Muse Charm, expected to ship during the holiday season. While details are limited, Charm is extremely compact, allowing users to interact with Muse on the go and further integrating Muse into consumers' daily lives.

Additionally, Meta has released a lightweight VR headset that weighs less than a fifth of the Quest 3, appearing more like regular glasses rather than a bulky headset. This product is set to launch next spring, with a starting price of $1,299, and will have Muse directly integrated into the operating system. The new glasses will combine VR/3D gaming, entertainment (movies, TV, concerts/events, and about 100 sports live streams expected in 2027), and productivity tools (a full virtual multi-screen dynamic desktop and keyboard).

Morgan Stanley says that, although it was previously skeptical about Meta’s investments in AR/VR, this product shows significant improvements in size and performance and could become an important catalyst for stock price appreciation in 2027. The report stresses that the current share price does not reflect any success from the AR/VR business.

Core Logic: Meta Advances Structural Transformation, Three “Call Options” Underestimated

Morgan Stanley gives Meta an "Overweight" rating, with a target price of $775 and a bull case scenario up to $1,000.

Morgan Stanley believes Meta is undergoing a structural transformation, focusing on multi-year efficiency, productivity, and a more streamlined operation. The bank points out that the “Year of Efficiency” is more than just a short-term 365-day adjustment; it's a structural shift in operating model and corporate culture towards leaner operations and greater focus on investor returns, even during investment cycles.

Meanwhile, revenue and engagement trends on Meta’s platforms are also improving. Interactions with both the industry and the company show continuing progress in Reels engagement and monetization, as well as ongoing optimization in post-IDFA advertising measurement and attribution. In addition, Morgan Stanley sees three underestimated “call options”: 1) AI-driven further upside; 2) subscription service adoption; 3) click-to-message ad growth.