When Facebook announced a corporate name change to Meta Platforms Inc. (ticker: META) in October 2021, many investors began to realize just how transformative the metaverse could be. The metaverse concept is about building integrated virtual environments in which people live, work and play. A real-life “Matrix” may seem like science fiction, but the ideas of self-driving cars, smartphones or even the internet itself were all science fiction concepts at one point as well. The global metaverse market could grow to $936.6 billion in revenue by 2030, according to Grand View Research.
[Sign up for stock news with our Invested newsletter.]
Here are seven of the best metaverse stocks to buy today:
— Meta Platforms Inc. (META)
— Roblox Corp. (RBLX)
— Nvidia Corp. (NVDA)
— Unity Software Inc. (U)
— Microsoft Corp. (MSFT)
— Taiwan Semiconductor Manufacturing Co. Ltd. (TSM)
— Advanced Micro Devices Inc. (AMD)
Meta Platforms Inc. (META)
CEO Mark Zuckerberg is committed to shifting the company’s priority to the metaverse. Meta’s Reality Labs unit is responsible for developing the virtual reality and augmented reality technology that helps to create the metaverse. Unfortunately, Zuckerberg’s ambitious metaverse goal is off to a rough start, and as of the second quarter, Reality Labs has lost more than $21 billion since the beginning of 2022. However, the company recently announced its Quest 3 mixed-reality headset and new Ray-Ban smart glasses, its latest efforts to gain a first-mover advantage in the metaverse.
Roblox Corp. (RBLX)
Roblox is an online entertainment platform that allows creators to develop games. It may be the closest thing to a functioning metaverse today. Roblox is essentially a video game that has 65.5 million daily active users, its own digital currency and a range of unique virtual experiences. About 43% of its user base was under 13 years old as of the second quarter, potentially positioning the company well for the future. The company reported 14 billion hours of engagement in the quarter, up 24% from a year ago. Roblox CEO David Baszucki has a long-term goal of Roblox reaching 1 billion global users.
Nvidia Corp. (NVDA)
Nvidia produces the graphics and video processing chips used in high-end computing servers, supercomputers, and artificial intelligence and VR applications. The metaverse will certainly require a massive amount of processing power, and Nvidia chips will likely play a critical role. The Nvidia Omniverse is a real-time reference development platform used for building and operating metaverse applications. In September 2023, Nvidia announced Nvidia Omniverse Cloud, the company’s first software- and infrastructure-as-a-service offering. “With Omniverse in the cloud, we can connect teams worldwide to design, build and operate virtual worlds and digital twins,” Nvidia CEO Jensen Huang said in a statement on Nvidia’s website.
[READ: 10 Best Tech Stocks to Buy for 2023]
Unity Software Inc. (U)
Unity Software owns one of the two main 3D video game engines, which allows designers to customize how video game players move and interact within their games. In addition, Unity’s non-gaming business serves the industrial, architectural, animation and engineering industries. Unity’s Muse generative AI tool helps bring object, animation and code generation to a larger audience of developers. Unity Sentis allows users to embed neural networks into their creations to achieve better real-time experiences. The company reported 80% revenue growth in the second quarter following its merger with ironSource in November 2022, which should help attract more mobile game developers.
Microsoft Corp. (MSFT)
Microsoft may be the early leader in the professional metaverse. The Microsoft enterprise metaverse aims to integrate smart devices, digital twins and mixed reality to help Microsoft grow its professional software market dominance. The company’s fast-growing cloud business also gives it major metaverse network scale advantages. Microsoft could also make an aggressive move into the social metaverse now that it has finally completed its acquisition of video game giant Activision Blizzard. “Gaming is the most dynamic and exciting category in entertainment across all platforms today and will play a key role in the development of metaverse platforms,” Microsoft CEO Satya Nadella said when the Activision deal was announced.
Taiwan Semiconductor Manufacturing Co. Ltd. (TSM)
Taiwan Semiconductor Manufacturing is the world’s largest pure-play semiconductor foundry. Taiwan Semiconductor produces the high-end AI chips companies like Meta Platforms need to power the metaverse. Apple Inc. (AAPL) has also chosen TSMC to develop advanced display technology for its augmented reality devices. Taiwan accounts for more than 60% of global semiconductor production, including a 92% share of leading-edge chips. Deloitte estimates that the metaverse could have between a $17 billion and $32 billion annual economic impact for Taiwan by 2035. TSMC said in September that booming demand for AI chips has created supply constraints that will take about 18 months to alleviate.
Advanced Micro Devices Inc. (AMD)
Shares of microprocessor and graphics semiconductor stock Advanced Micro Devices are up about 300% in the past five years, a testament to the company’s positioning in high-demand markets such as online gaming, cloud computing and the metaverse. In 2021, AMD secured a deal with Meta Platforms to supply its EPYC chips to power the social media giant’s data centers. AMD reported data center segment revenue was down 11% year over year in the second quarter due to soft enterprise demand and elevated cloud inventory levels, but the company guided for a return to revenue growth in the third quarter.
More from U.S. News
7 Stocks That Outperform in a Recession
8 Best Stocks to Buy Now With $1,000
8 Best Defense Stocks to Buy Now
7 Best Metaverse Stocks to Buy Now originally appeared on usnews.com
Update 10/24/23: This story was previously published at an earlier date and has been updated with new information.
