Deutsche Bank Names Meta as Top AI Trade Pick

Deutsche Bank analysts identified nine technology stocks, including Meta Platforms and ServiceNow, as the primary leaders for the next phase of the artificial intelligence trade. The bank is shifting its strategic focus away from broad semiconductor exposure and toward software platforms capable of monetizing AI agents and specific hardware value chain players.

Meta Platforms has aggressively expanded its AI infrastructure investment, raising its full-year capital expenditure floor to $130 billion. Despite these costs, the company's core advertising business remains strong, with ad impressions increasing 14%. Meta provided third-quarter revenue guidance between $61 billion and $64 billion.

Financial performance for the second quarter showed a decline in net income to $15.85 billion and a drop in free cash flow to $784 million, which analysts attribute to the rising costs of AI development. The company continues to prioritize the integration of AI to power next-generation products and enterprise opportunities.