From the start of 2020 through the end of 2024, shares of advertising technology (adtech) company The Trade Desk (TTD 3.75%) were up an impressive 352%, trouncing the comparable 82% return for the S&P 500. In fact, this market-trouncing performance helped land The Trade Desk a spot in the S&P 500 index earlier this year.

However, 2025 has been rough for shareholders. As of this writing, The Trade Desk stock is down 63% year to date, making it the lousiest stock in the S&P 500. And it’s not hard to understand the reason why.

On Aug. 7, The Trade Desk reported financial results for the second quarter of 2025. But it also gave guidance for the upcoming third quarter. And for Q3, management expects to generate revenue of $717 million. This represents a revenue growth rate of just 14%.

The Trade Desk has only ever reported one quarter with growth as slow as what it’s projecting for Q3, and it was the first quarter of the COVID-19 pandemic — hardly an ordinary three months.

Data by YCharts.

Here’s the kicker: The Trade Desk just released an artificial intelligence (AI)-powered version of its platform, called Kokai. Management said this new software is the “most significant platform upgrade to date, and one that represents a new frontier in digital advertising trading.”

When investors hear things like “most significant” and “new frontier,” they expect it to serve as a catalyst for new growth. This is why they’re so disappointed with The Trade Desk, saying that business is about to significantly slow down. It seems contradictory.

Investors might finally have better information to explain the apparent contradiction. And it could be the key to knowing whether The Trade Desk stock is a beaten-down stock to buy now or not.

What’s going on with Kokai?

On the Q2 conference call, The Trade Desk CEO Jeff Green excitedly said, “We expect all of our clients to be using Kokai by the end of this year.” But it seems like not all of the company’s clients are happy about it. According to Adweek, many of The Trade Desk’s clients may prefer its old Solimar platform over its new Kokai platform. There are features that might not be as user-friendly. And this might be causing some customers to give other adtech options a try.

While Green pointed out that client spend is increasingly moving through Kokai, it’s worth noting that it’s also becoming the default option. And as that happens, it seems some customers are turning elsewhere in frustration. Many investors have been concerned about competitive pressures on The Trade Desk from Amazon‘s fast-growing advertising business. Adweek also points out that some advertisers are even turning to Yahoo! because its take rate is just a fraction of The Trade Desk’s take rate.

The Trade Desk’s customers could keep using the Solimar platform if they’re discontent with the new Kokai platform. But it’s possible that some of them aren’t clear on this. According to AdExchanger, some of The Trade Desk’s clients may believe a rumor that Solimar is being phased out soon, which would force them to use a Kokai platform that they don’t like. So this could also be contributing to experimentation with other adtech platforms such as Yahoo!.

This could all perfectly explain why a growth stock such as The Trade Desk is forecasting a meager 14% growth rate right after launching its “most significant platform upgrade” ever.

The Trade Desk isn’t lying down

It’s very possible, if not likely, that The Trade Desk is looking at a user interface problem, not a technology problem. And that would be very relieving for shareholders. After all, user interfaces are easily improved.

Indeed, Green on the Q2 call said, “The iteration on client feedback has been really rapid,” when it comes to Kokai. In other words, the company’s customers are telling it what they don’t like, and it’s making improvements as fast as it can. That’s good.

Moreover, Green had promising things to say about Kokai when it comes to the technology. He said that, in aggregate, customers using Kokai are getting better results for their money. And this is key. At the end of the day, a company can overcome a bad user interface if the technology can give wins to its customers.

To conclude, here’s what I think is the most likely outcome here: Given its long track record of success, I think The Trade Desk will relentlessly work until it fixes its problems. That could take a couple of quarters. But I think the company will get past the issues that are holding back its customers right now. And once that happens, investors will finally see the growth rate that they’ve been expecting from the launch of Kokai.

Jon Quast has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Amazon and The Trade Desk. The Motley Fool has a disclosure policy.

Interest in artificial intelligence went parabolic following the release of ChatGPT in late 2022. Since then, Nvidia stock has advanced 1,090% to a market value of $4.2 trillion. And Palantir Technologies stock has climbed 2,340% to a market value of $370 billion. That means the companies are collectively worth $4.6 trillion.

I predict Meta Platforms (META -1.69%) will surpass that figure in no more than five years (i.e., before the end of 2030). The company is currently worth $1.9 trillion, which means its share price must increase by about 247% for its market value to reach $4.7 trillion. Here’s why I think that could happen.

Meta Platforms is a digital advertising giant with deep AI expertise

Meta Platforms owns three of the four most popular social media platforms as measured by monthly active users. That competitive advantage lets it collect consumer data on a tremendous scale, and that data helps brands target ad campaigns. As a result, Meta is the second-largest adtech company worldwide and is likely to gain market share, according to Morningstar.

Meta has already made strides in boosting engagement with artificial intelligence (AI). CEO Mark Zuckerberg told analysts on the second-quarter earnings call, “Advancements in our recommendation systems have improved quality so much that it has led to a 5% increase in time spent on Facebook and 6% on Instagram.” He also said that advertising conversion rates increased across both social media platforms, meaning more clicks and purchases.

Importantly, Meta is investing aggressively in AI infrastructure and aspires to automate the entire ad creation process by next year. The Wall Street Journal writes, “Using the ad tools Meta is developing, a brand could present an image of the product it wants to promote along with a budgetary goal, and AI would create the entire ad, including imagery, video, and text.”

Meta’s Orion smart glasses could be the next big consumer electronics product

Meta Platforms is the market leader in smart glasses, a nascent market where shipments more than tripled last year and are forecast to increase faster than 60% annually through 2029. And Meta is actually gaining market share. Its Ray-Ban smart glasses accounted for nearly three-quarters of shipments in the first half of 2025, up from 60% in 2024.

Counterpoint Research writes, “Ray-Ban Meta smart glasses redefine the smart glasses experience by integrating wearable AI while combining a stylish design with enhanced smart functionalities.” The company sees a large opportunity on the horizon. Zuckerberg believes smart glasses could replace smartphones as the personal computing form factor of choice within the next 15 years.

To capitalize, Meta announced Orion last year, smart glasses that incorporate augmented reality (AR) that overlays the physical world with holographic displays. The company will not commercialize the product for several years while it works to make the technology less expensive. However, smart glasses that blend AR and AI could be revolutionary, as they would enable wearers to search the internet, talk with friends, and watch media content without phones.

Apple rose to great heights following its introduction of the iPhone in 2007. If Zuckerberg is correct about smart glasses being the next big breakthrough in consumer electronics, Meta could become the Apple of the next decade, which means its market value could increase substantially in the years ahead.

Meta Platforms could be a $4.7 billion company by mid-2030

To summarize, Meta has a strong presence in digital advertising and a leadership position in smart glasses. Adtech spending is forecasted to grow at a rate of 14% annually through 2032, while smart glasses sales are projected to increase by more than 60% annually through 2029. In total, that gives Meta a reasonable shot at annual earnings growth of 20%+ in the next five years.

That outlook makes the current valuation of 26.7 times earnings seem quite reasonable. And if Meta does grow earnings at 20% annually over the next five years, its share price could increase by 149% without any change in the price-to-earnings (P/E) ratio. That would bring its market value to $4.7 trillion by mid-2030, surpassing the current combined market value of Nvidia and Palantir.

Trevor Jennewine has positions in Nvidia and Palantir Technologies. The Motley Fool has positions in and recommends Apple, Meta Platforms, Nvidia, and Palantir Technologies. The Motley Fool has a disclosure policy.

The stocks of Google parent Alphabet (GOOGL 3.10%) (GOOG 2.98%) and Meta Platforms (META 2.04%) shot higher in Friday trading. Although most stocks rose because the Federal Reserve strongly hinted at a September cut in interest rates, another factor was likely the announcement of Meta’s cloud deal with Google, as reported by The Information.

Considering the $10 billion size of the deal, one has to assume it is critical, particularly to Alphabet. Still, considering the state of the artificial intelligence (AI) stock, it could serve as a much-needed catalyst for the company’s investors. Here’s why.

Terms of the partnership

Under the terms of the deal, Meta will pay Google $10 billion over six years. In exchange, it will receive access to Google Cloud’s storage, server, and networking services, along with other products.

Meta has previously relied on Amazon‘s Amazon Web Services (AWS) and Microsoft‘s Azure for such services. The deal does not necessarily mean it will deal less with these companies. More likely, it speaks to Meta’s insatiable demand for cloud infrastructure as it seeks to become a major player in the AI space.

Additionally, Meta and Alphabet are each other’s largest competitors in the digital advertising market. And in the first half of 2025, 98% of Meta’s revenue came from digital ads. Hence, in a sense, it is remarkable that these two would become partners in a different business.

How it helps Alphabet

However, in another sense, this is a huge step forward for Alphabet’s future. In the first half of this year, Alphabet earned 74% of its revenue from the digital ad market, down from 76% in the same period in 2024. This is also by design, as Alphabet has purchased dozens of businesses unrelated to the digital ad market in its efforts to transition into a more diversified technology enterprise.

So far, Google Cloud is the only one of these enterprises to appear in Alphabet’s financials. It accounted for 14% of Alphabet’s revenue in the first two quarters of 2025, up from 12% in the same year-ago period.

Additionally, Google Cloud generated over $49 billion in revenue over the trailing 12 months, implying the $10 billion from Meta over six years will make up a relatively small portion of Google Cloud’s business.

Nonetheless, the deal serves as a vote of confidence for Alphabet’s cloud business, one that continues to lag AWS and Azure in terms of market share.

The investor perspective is also crucial. Over the last year, Alphabet stock has outpaced the total returns of the S&P 500 by a significant but not eye-popping margin. However, it may help that Alphabet’s price-to-earnings (P/E) ratio of 22 is the lowest among “Magnificent Seven” stocks. Hence, the Meta deal could prompt investors to look more favorably upon that earnings multiple.

GOOGL Total Return Level data by YCharts.

Furthermore, if the Meta deal prompts other companies to do more business with Google Cloud, it could provide a boost to its market share and, by extension, Alphabet stock.

The Meta deal and Alphabet stock

Ultimately, Meta’s deal with Google Cloud will more than likely take Alphabet stock a leg higher, but investors should expect the effects to be more indirect. Indeed, the deal is remarkable in that it serves as a boost for third-place Google Cloud and is notable since the two companies are direct competitors in each other’s largest enterprises.

Although $10 billion in added business over six years is substantial, Google Cloud generated $49 billion over the last 12 months. Thus, it is a significant but not game-changing boost to the enterprise.

However, the deal may make Google Cloud more attractive to prospective customers, and the low P/E ratio could attract more investors to Alphabet. In the end, those could become the more significant benefits of the deal.

Will Healy has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Alphabet, Amazon, Meta Platforms, and Microsoft. The Motley Fool recommends the following options: long January 2026 $395 calls on Microsoft and short January 2026 $405 calls on Microsoft. The Motley Fool has a disclosure policy.

They’re too young for jobs, but not too young to shape the economy. Gen Alpha’s spending influence is real and growing, with new data from public relations firm DKC showing that children in this age range (8-14) impact nearly half of their households’ purchasing decisions. 

When ads become content: The new norm for Gen Alpha

Unlike any generation before, Gen Alpha never experienced a time without pervasive digital influence. Social media is where entertainment and ads mix, sometimes reaching children who might not fully understand they’re being marketed to.

In the past, a child hearing, “No, you don’t need that,” from a parent learned to manage impulses tangibly and productively. The store aisle was a controlled environment, and adults helped set limits that felt real and immediate. 

But today’s reality is different, and on social media, that kind of guidance doesn’t exist for Gen Alpha. Children as young as age 8 or 9 are bombarded with powerful, direct and highly engaging visual corporate messages that turn products and commercial lifestyles into objects of near-obsessive admiration. For today’s young generation, the line dividing entertainment from advertising has effectively vanished. Corporate messages no longer knock before suggesting consumerism; now, they live inside the content itself with very little oversight or regulation.

Teens see thousands of targeted online ads every day

Children are uniquely vulnerable to marketing because their skills at critical thinking and impulse control are still developing. The constant stream of familiar faces, stories and product placements on social media can light up the same pleasure centers that drive adult buying habits, conditioning young minds to crave and consume in ways that can become deeply ingrained and addictive. 

Advertising for children has evolved into a multibillion-dollar industry. According to estimates shared by UNICEF, a typical 14-year-old encounters around 1,260 advertisements daily on social media. 

Brands track children’s online behavior using sophisticated algorithms and data analytics, allowing them to deliver personalized ads that target kids’ interests and emotions. This constant, tailored exposure creates strong desires in children, who then repeatedly ask their parents to buy the products—a phenomenon known as “pester power.” Parents, often giving in to avoid conflict, complete the cycle with the final purchase. 

Kids’ spending power reaches $101 billion annually in the U.S.

According to DKC, parents of kids ages 8 to 14 estimate that 42% of household purchases are swayed by their children, with Gen Alpha directly controlling $101 billion of consumer spending power. The average child in this age group has $67 a week to spend, equaling $3,484 a year—almost 50% more than in 2024, according to Axios. Gen Alpha is drawn to highly visual, interactive and community-driven entertainment. Popular platforms like YouTube, TikTok and gaming streams dominate their screen time, with many preferring short, snackable content that fits into their fast-paced digital lives.

Gen Alpha thrives on popular cultural messages that flow naturally into their everyday conversations. Living and breathing online culture, their social norms create a clear divide from Gen Z in the digital realm. This generation rejects straightforward marketing altogether. They want to see their purchases woven into stories they can follow and engage with. 

How brands speak directly to Gen Alpha through storytelling

To reach Gen Alpha, brands are moving beyond traditional ads to create immersive, narrative-driven content. MrBeast (Jimmy Donaldson) is one of the world’s top digital influencers, and among the wealthiest, proving how a single creator can build a brand worth hundreds of millions. As of 2025, his net worth is estimated to be at $1 billion, with annual earnings reportedly exceeding $100 million through YouTube ad revenue, sponsorships, merchandise and his own product lines. His success is a prime example of how creative content and smart marketing can lead to massive earnings. 

With over-the-top challenges and jaw-dropping generosity, MrBeast keeps his young fans glued to the screen. But look closer, and you’ll see brilliant marketing at work. From slick sponsorships to subtle plugs for his own brands, like Feastables and MrBeast Burger, every view is a sales opportunity.

While viral TikTok trends generate quick buzz, they rarely foster lasting loyalty. Instead, brands are becoming full-fledged media creators, producing original, high-quality videos and collaborating with influencers to build enduring digital communities that resonate with young audiences.

In today’s social media landscape, advertising has transformed into a sophisticated creative industry. Leading directors and social creators craft compelling stories that connect deeply with Gen Alpha, blending cinematic artistry with cultural relevance. This approach makes brand messages feel authentic and engaging, speaking directly to a generation raised entirely within the digital world.

For Gen Alpha, connection with brands isn’t transactional; it’s relational. This generation demands narratives that resonate and communities that feel real. Marketers today face a paradox with this demographic though: They must build relationships through storytelling and community, yet do so with heightened awareness that this audience is uniquely impressionable. Responsibility here isn’t a box to check—it’s a continuous, evolving commitment to respect the boundaries between engagement and exploitation in an environment where those lines so often disappear.

Photo by LightField Studios/Shutterstock