2 Potential Artificial Intelligence (AI) Stock Splits Investors Could See in 2025

High-quality companies tend to create enormous amounts of value, sometimes driving the price per share into the hundreds (or even thousands) of dollars. It may be too expensive for small investors to buy at this price level (unless they use a broker offering fractional shares), leaving institutional investors and large funds holding a share dominant of the cake.

A stock split can alleviate this problem by increasing the number of shares outstanding while organically reducing the price per share. Stock splits are entirely cosmetic and do not change the value of the underlying company, but they do make the shares more accessible to small retail investors.

Stock splits were popular in 2024

Several high-profile companies have carried out stock splits this year:

• Nvidia completed a 10-for-1 stock split on June 10, which increased the number of shares outstanding tenfold and reduced its price per share from $1,200 to $120.

• Chipotle completed a 50-for-1 stock split on June 26, which reduced its price per share from $3,283 to $66.

• Broadcom completed a 10-for-1 stock split on July 12, which reduced its price per share from $1,700 to $170.

A new year is fast approaching and some analysts are wondering who might pull off stock splits in 2025. I think Microsoft (NASDAQ:MSFT) And Metaplatforms (NASDAQ:META) could find their place on the list. Of the six tech companies valued at $1 trillion or more, these two companies have the highest prices per share.

They could become even more expensive as they expand their presence in the artificial intelligence (AI) sector. Here’s why they could each benefit from a split.

Image source: Getty Images.

1. Microsoft: a possible 3-for-1 stock split in 2025

Microsoft has completed nine spinoffs since its stock went public in 1986. The company has created a staggering $3 trillion in value for investors over the past 38 years, and if it hadn’t done any spinoffs , its shares would be trading today at $119,500!

Microsoft’s most recent split took place more than two decades ago, in 2003. The company’s shares are trading at $415 as of this writing, so it could be due for another in the future close – especially because of the potential value the company stands to create through its investments in AI.

Microsoft is a key investor in ChatGPT creator OpenAI and has used the startup’s technology to create the Copilot virtual assistant, built into its flagship software products such as Windows, Bing and Edge for free. However, users of 365 productivity apps, like Word, Excel, and PowerPoint, can also add Copilot to their plans for an additional monthly subscription.

Copilot can accelerate workflows in 365 by quickly generating text and image content and also answering complex questions on a range of topics. Organizations around the world are paying for 365 software licenses (over 400 million at present), all of which are candidates for the Copilot add-on, so this could represent a huge financial opportunity for Microsoft.

Then there is Microsoft Azure, which is one of the largest cloud service providers in the world. It is a go-to destination for developers looking for cutting-edge computing infrastructure and ready-to-use large language models (LLMs), like OpenAI’s latest o1 series, which are the ingredients keys to creating powerful AI software applications.

Azure revenue jumped 33% year over year in the first quarter of fiscal 2025 ended September 30, and 12 percentage points of that growth came specifically from AI services. That’s up from 8 points in the previous quarter just three months earlier, and the number has accelerated in every quarter since Microsoft started releasing it more than a year ago. This activity could be a key source of stock price appreciation in the years to come.

If Microsoft does a 3-for-1 split, its stock will fall to $138 per share, making it more accessible to small investors. This would also put it on par with other trillion-dollar tech giants like Nvidia, Amazon, AlphabetAnd Applewhose stock prices are between $100 and $250.

2. Metaplatforms: a potential 10-for-1 stock split in 2025

Metaplatforms have Never I have done a stock split, but I think there may be one in the near future. The company went public in 2012 at a price of $38 per share, but has since soared to $554, representing the highest price of any tech stock in the trillion-dollar club.

Meta is the parent company of the social networks Facebook, Instagram and WhatsApp, which serve nearly 3.3 billion people around the world every day. The company generates most of its revenue by selling advertising space to businesses. So, the more time each user spends on the company’s platforms, the more ads they will see and the more money Meta will earn.

The company increases engagement by using AI algorithms to learn what each user likes to see so it can curate its content feeds to maintain attention. Mark Zuckerberg, CEO of Meta, says this strategy has led to an 8% increase in the time each user spends on Facebook so far this year and a 6% increase for Instagram.

Releasing new features also helps boost engagement. Meta launched an AI-powered virtual assistant called Meta AI last year, which users can access through each of the company’s social apps. It can generate text and images and even join your group chat to settle debates with friends or offer suggestions for fun activities. Meta AI had amassed 500 million monthly active users as of Q3 2024 (ended September 30), so it is poised to become one of the company’s most popular products.

Meta AI is powered by Llama, an LLM that Meta built in-house. The company is set to invest up to $40 billion in data center infrastructure this year, which will provide enough computing power to launch Llama 4 in 2025. It will be the most powerful LLM in Meta to date, and Zuckerberg says he has the potential to become the leader. the entire industry.

Meta stock is trading at a forward price-to-earnings (P/E) ratio of 21.9, based on Wall Street’s consensus forecast for the company’s earnings per share in 2025. That means the stock is expected to climb 71% over the next year just to trade in line with its 10-year average P/E ratio of 37.5, implying a stock price of $947.

I think Meta should consider a split right now, but a 10-for-1 split could be an obvious move if the stock approaches four figures next year.

Don’t miss this second chance and a potentially lucrative opportunity

Have you ever felt like you missed the boat by buying the best performing stocks? Then you will want to hear this.

On rare occasions, our team of expert analysts issues a “Doubled” actions recommendation for businesses that they believe are on the verge of collapse. If you’re worried that you’ve already missed your chance to invest, now is the best time to buy before it’s too late. And the numbers speak for themselves:

• Nvidia: If you invested $1,000 when we doubled down in 2009, you would have $363,386!*

• Apple: If you invested $1,000 when we doubled down in 2008, you would have $43,183!*

• Netflix: If you invested $1,000 when we doubled down in 2004, you would have $456,807!*

Right now, we’re issuing “Double Down” alerts for three incredible companies, and there may not be another chance like this anytime soon.

See 3 “Double Down” Stocks »

*Stock Advisor returns November 18, 2024

John Mackey, former CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool’s board of directors. Suzanne Frey, an executive at Alphabet, is a member of The Motley Fool’s board of directors. Randi Zuckerberg, former director of market development and spokesperson for Facebook and sister of Meta Platforms CEO Mark Zuckerberg, is a member of The Motley Fool’s board of directors. Anthony Di Pizio has no position in any of the stocks mentioned. The Motley Fool holds positions and recommends Alphabet, Amazon, Apple, Chipotle Mexican Grill, Meta Platforms, Microsoft and Nvidia. The Motley Fool recommends Broadcom and recommends the following options: long January 2026 $395 calls on Microsoft, short December 2024 $54 calls on Chipotle Mexican Grill, and short January 2026 $405 calls on Microsoft. The Motley Fool has a disclosure policy.