Meta Reverses Decision, Keeps Horizon Worlds Available for VR Users
- Platform Continuation: Meta has decided to keep the Horizon Worlds VR platform operational despite earlier plans to shut it down by June 15, demonstrating responsiveness to user feedback by supporting existing games for fans.
- Game Engine Transition: Horizon Worlds will continue to utilize the Horizon Unity game engine, but no new games will be added, reflecting Meta's strategic pivot away from VR social networking towards mobile applications.
- User Base Challenges: Since its launch in 2021, Horizon Worlds has struggled to attract a significant user base, with monthly active users never exceeding a few hundred thousand, while competitors like Roblox report over 100 million daily active users, highlighting Meta's challenges in the VR social space.
- Technological Shift: Meta's Horizon Engine aims to deliver smoother performance and sharper visuals, and while Horizon Worlds has not gained mainstream traction, the company is still focused on enhancing user experience through technological advancements.
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- Portfolio Performance: Despite a strong global equity market in 2025 driven by AI and top tech stocks, Montaka's portfolio underperformed due to significant dispersion in stock returns, with some holdings declining from short-term factors like AI disruption and weakness in housing sectors, indicating market uncertainty.
- Positive Market Outlook: Montaka maintains a positive outlook, believing that long-term opportunities will grow as AI adoption accelerates, particularly in investments in data centers, semiconductors, and critical commodities like lithium, reflecting confidence in structural trends.
- Strategic Adjustments: The fund has adjusted its strategy by adding undervalued positions, trimming holdings that rallied, and initiating a new investment in a lithium producer to address future supply shortages linked to renewable energy and battery demand, showcasing its adaptive investment approach.
- Meta Platforms Analysis: Montaka highlighted Meta Platforms (NASDAQ:META) in its letter, noting a one-month return of -9.30%, yet emphasized that AI-driven improvements in ad targeting significantly enhance advertising effectiveness, underscoring the company's competitive edge in digital advertising.
- Subscription Service Testing: Meta is testing a premium subscription service called Instagram Plus on its Instagram app, allowing users to view Stories without notifying the poster, enhancing user privacy and potentially attracting more subscribers.
- New Feature Rollout: The subscription will offer unlimited audience list creation and the ability to see how many times a Story has been viewed, enhancing user engagement and content management capabilities, which may increase user retention.
- Market Testing Regions: The service is currently being tested in Mexico, Japan, and the Philippines, with pricing varying by country, demonstrating Meta's flexible pricing strategy aimed at maximizing user acceptance and market penetration.
- User Base Impact: With approximately 3 billion monthly active users, Instagram may account for about 40% of Meta's total revenue, and if successfully launched, this service could significantly boost the company's revenue and competitive position in the market.
Meta's New Offering: Meta has launched a premium subscription service for Instagram users, allowing them to access exclusive features and content.
Testing Phase: The subscription service is currently in a testing phase, with select users being invited to participate and provide feedback on the new features.
- Trump's Comments Impact: Trump's statement about serious discussions with Iran led to a rise in the S&P 500, but Jim Cramer cautioned investors against rushing to buy, as Trump's claims are often later denied by Iran, indicating market uncertainty.
- Meta Stock Surge: Meta was named a top pick by Morgan Stanley, with shares rising over 2%, as analysts argue that despite AI investment and regulatory risks, Meta remains competitively strong; Jim Cramer supports this view, suggesting investors should not sell due to regulatory concerns.
- Cybersecurity Stock Rebound: CrowdStrike and Palo Alto Networks rebounded after significant declines last Friday, with CrowdStrike up nearly 5% following an upgrade to buy-equivalent by Wolfe Research, as analysts believe advancements in AI models will increase demand for cybersecurity.
- Executive Buy Signal: Palo Alto Networks CEO Nikesh Arora purchased about $10 million in shares on Friday, resulting in a 7% stock increase, with Jim Cramer noting that the market is mispricing the stock, reflecting executive confidence in the company's future.
Market Performance: Last week, the Nasdaq and Dow experienced significant corrections, with Alphabet's stock dropping nearly 9%, leading to substantial losses in market capitalization and raising concerns about the tech sector's stability amid fears of inflation and geopolitical tensions.
Alphabet's Challenges: Alphabet is facing scrutiny due to a recent jury ruling against its subsidiary YouTube in a social media addiction case, which could lead to future litigation and financial penalties, despite the current penalty being minor.
AI Developments: Google announced a new AI memory compression algorithm called TurboQuant, which aims to enhance AI model efficiency, potentially impacting the memory chip sector and causing stock sell-offs among companies like SanDisk and Micron Technology.
Investment Outlook: Despite a 12% decline in Alphabet's stock this year, it remains one of the top-performing stocks over the past 12 months, and analysts suggest that maintaining support above the 200-day SMA is crucial for future performance, with recommendations for investors to consider buying now.
- Increased Volatility: Despite a modest 1.7% gain on Monday, Meta's stock is in a downtrend, having declined approximately 11% over the past five trading days, indicating market concerns about its future performance.
- Weak Technical Indicators: The stock is trading well below its 200-day moving average, with a relative strength index (RSI) of 26.71, firmly in oversold territory, reflecting a significant weakening in investor sentiment.
- Historical Low Review: Meta's stock price has fallen to its lowest level since April 2025, down over 32% from its all-time high of $796.25 reached on August 15, signaling a lack of confidence in its fundamentals.
- Impact of Legal Challenges: Recent courtroom setbacks have heightened investor concerns, and while short-term rebounds may be possible, the current market environment indicates heightened volatility and negative sentiment surrounding Meta's stock.











