I’m rotating around 80% of my MSFT position into META. Here’s my reasoning.

I made around $120,000 selling my MSFT at 494 today, and will be rotating most of my MSFT into META next. Here’s why:

I think META is undervalued mostly because people are worried about Zuckerberg’s spending and leadership decisions, not because the underlying business is weak. Last earnings also looked worse partly because of large one-off legal expenses, rather than a major deterioration in the core ad business.

My bigger concern is Microsoft’s exposure to circular AI financing. On paper, Microsoft benefits multiple times: it invests in OpenAI, the value of that investment increases, and OpenAI then spends huge amounts buying Azure compute from Microsoft. That all looks great while OpenAI keeps raising money and growing, but OpenAI is still losing a lot of money. If AI monetization does not eventually justify the spending, both the investment value and some of the Azure revenue could look much less secure.

Meanwhile, I think Meta has the cleanest AI monetization story. Billions of real people already use its apps, and millions of normal businesses pay Meta for ads because those users buy actual products and services. AI improves recommendations, engagement and advertising results. Meta does not need AI startups to keep raising billions and spending it back on Meta infrastructure.
Microsoft, Google, Amazon and Nvidia all benefit heavily from the current AI capex cycle and a relatively small number of massive customers. Meta’s AI revenue feels more directly connected to real users and real advertisers.

I’m not saying Microsoft is a bad company, and META obviously has risks from overspending. I just currently trust Meta’s revenue loop more.

Thoughts? What am I missing?

TLDR: META/maybee GOOG is the few of the top tech companies which will have a clean B2C AI revenue going forward. The others rely or circular investments and big/risky deals. META is also basically selling cocaine that is legal and able to be used everywhere.