Meta Launches AI Mode and Muse Spark on Facebook

What did Meta launch on Facebook?

Meta Platforms rolled out AI Mode on Facebook on June 15, 2026. The feature uses Meta AI to answer questions based on publicly shared content across Meta's platforms, including Groups and Reels. It appears directly in Facebook's Feed and search functions.

Meta AI is powered by Muse Spark, the first model from Meta Superintelligence Labs (MSL), according to Meta's official announcement. MSL describes Muse Spark as purpose-built to prioritize people.

What new creative tools is Meta adding to Facebook?

Beyond search, Meta is adding several AI-powered editing features. Users can generate collage cutout templates and transition effects for video montages. The company confirmed that camera roll sharing suggestions remain opt-in and can be turned off.

Meta is also launching photo presets — tools that let users modify clothing, hair, and accessories using AI. Sports fans can use the feature to virtually wear team jerseys. The option appears by tapping the AI Edit icon in Stories or selecting "Restyle profile picture with AI" from a profile page.

How does AI Mode work on Facebook?

AI Mode is integrated into Facebook's existing search and Feed features. It draws on publicly shared content from across Meta's platforms — not just a user's personal feed. The tool is designed to surface relevant answers without requiring users to leave the app.

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Here's what we know so far: all three feature sets — AI Mode, video editing, and photo presets — run on Muse Spark, Meta's new in-house model, rather than a third-party AI system.

What does Morgan Stanley say about Meta's AI strategy?

Morgan Stanley analyst Brian Nowak reiterated Meta as a "top pick" and maintained a $775 price target, as reported by Investing.com. That target represents roughly 30% upside from current levels.

Nowak identified four emerging products he believes could each add $1 to $3 to Meta's 2028 earnings per share:

• AI-integrated search within Meta AI — if the tool retains 1 billion users and monetizes just 10% of daily queries, Nowak estimated it could generate over $10 billion in annual revenue.
• Tiered subscriptions for Meta's 3.5 billion daily active users — modest adoption among 50 million content creators and millions of advertisers could bring in $7 billion in incremental revenue, adding $2 to earnings per share.
• AI-enhanced advertising — every 1% upside to modeled 2028 ad revenues would inject $3.5 billion into the business and boost earnings per share by 2.5%.
• Neocloud leasing — if Meta leases out one gigawatt of unused compute capacity at market rates, it could provide a minimum 8% upside to 2028 earnings.

What is Meta's financial position right now?

Meta stock is down 15% over the past year, underperforming the S&P 500's 23% gain over the same period. The stock dropped 5.5% in a single session after the Financial Times reported that Meta is exploring a major equity raise to fund its AI infrastructure buildout.

Meta trades at a 30% discount to Alphabet's Google on consensus earnings estimates. That gap sits nearly two standard deviations below Meta's historical average, according to the Morgan Stanley note.

Investor concern centers on Meta's projected $380 billion capital expenditure plan for 2027 and 2028. Nowak argued that limited visibility into returns on that spending has caused sentiment to lag behind other megacap technology peers.

How does this fit into the broader AI product race?

Meta's Facebook AI push comes as AI search tools are increasingly competing with traditional search engines for daily query volume. The integration of AI Mode directly into Facebook's Feed and search puts Meta in direct competition for that attention.

The move also reflects a broader shift toward usage-based AI billing models across the industry, which aligns with Nowak's thesis on Meta's tiered subscription opportunity.

Meta's heavy compute investment connects to a wider trend of hyperscalers building out AI infrastructure at scale, with leasing unused capacity — the "Neocloud safety net" Nowak described — becoming a real revenue hedge.

Key numbers at a glance

Meta's confirmed next step is the continued rollout of AI Mode, photo presets, and video editing tools across Facebook's existing features, including search and content browsing.