Shares of Schwab, LPL and Allstate fell sharply on fears that Meta's new AI agent could disrupt financial advice and insurance. Morgan Stanley's upside case for Meta's own revenue from Muse is far more modest.
Meta Platforms' new AI agent, Muse, has already shown it can move stocks. On Tuesday, it moved a lot of them that Meta does not own.
Investors sold a cross-section of wealth managers, brokerages and insurers on concern that an AI agent with mass consumer reach could eventually handle the kind of advice, comparison shopping and account servicing those companies charge for. LPL Financial fell 7.5%. Charles Schwab dropped 6.1%. Allstate slid 5.5%, Ameriprise Financial lost 4.4% and Raymond James fell 3.5%. Online travel company Booking Holdings, another business built on helping consumers compare and book, declined 2.6%.
The selloff reflects how quickly Muse has gained traction. The app has topped U.S. download charts over the past two weeks, and Meta is testing a human concierge layer on top of the AI agent. That kind of reach gives investors a concrete reason to imagine consumers asking an assistant about retirement savings or car insurance rather than calling an adviser or agent.
The contrast comes from Meta's own side of the ledger. Morgan Stanley estimates that if Muse reaches 100 million users by 2028, with each running five queries a day and 10% of that activity converting to commercial value, the product could generate about $1.3 billion in annual revenue and add roughly 35 cents a share to Meta's earnings. For a company of Meta's size, that would be a modest addition, and it rests on adoption and monetization assumptions three years out.
That gap defines Tuesday's trading. The market treated Muse as an immediate competitive threat to entire financial-services business models, while Morgan Stanley's estimate of Muse's value to Meta itself sits in the low single-digit billions and years away. Both can be true at once. Disruption risk for incumbents does not require the disruptor to capture most of the value. It only requires customers to change how they shop.
Meta hosts its Connect developer conference Wednesday and Thursday, the first real chance for the company to put usage, engagement or monetization numbers behind the enthusiasm. Alphabet's Google Labs is preparing a rival consumer agent, known as CC, which will offer a second read on how much of Muse's early momentum belongs to the category rather than to Meta alone.
For investors in the financial stocks caught in the selloff, the question is whether Tuesday priced a durable shift in how consumers access advice and insurance or a sentiment shock that runs ahead of any evidence of lost customers. Connect is unlikely to settle that. It may show whether Muse's user growth is steep enough to keep the fear alive.