Meta launches two offerings totaling about $35 billion to fund AI expansion
Key Facts
Meta launched two simultaneous public stock offerings worth about $35 billion, in a move to fund its expansion in artificial intelligence, data centers and cloud computing. The offerings include common shares and depositary shares representing convertible preferred shares, according to a company statement cited by Reuters. The financing comes as Meta expects capital spending of $135 billion to $145 billion during 2026. The company raised the lower end of its forecast from a previous range of $130 billion to $145 billion, according to its filing with the U.S. Securities and Exchange Commission. The plan reflects expanding infrastructure funding needs as investment in AI capabilities continues.
The increased investment coincides with strong revenue growth: Meta posted $64.601 billion in the third quarter of 2026, up 26% year over year. Revenue in the corresponding period of 2025 was about $51.242 billion, according to the company's financial filing. But capital expenditures totaled $34.91 billion in the third quarter, including payments on finance lease principal. The scale of investment weighed on free cash flow, which posted a deficit of $2.12 billion in the same quarter. These figures put infrastructure expansion in direct tension with the company's ability to fund it from cash flow, despite revenue growth.
Meta had $82.45 billion in cash and marketable securities on September 30, 2026, exceeding its $80.92 billion in long-term debt, according to Reuters. The offerings add a source of financing to the company's existing resources as capital spending needs increase. Nvidia, AMD and Broadcom also expressed interest in buying up to $5 billion of Meta's Class A common shares as part of the offerings. Meta said those indications are nonbinding and therefore do not represent a commitment to complete the purchases. The interest shows the link between chipmakers and Meta's infrastructure expansion, without determining the scale of their participation in the offerings.
The announcement comes amid market sensitivity to the cost of AI investments. Meta shares fell about 7% in the October 22, 2026 session, while the Nasdaq Composite dropped 2.6% in the same session, according to a report by Investing.com. On October 23, Meta shares closed at $642.62, according to EL7 data. The simultaneous declines in the stock and index reflect broader pressure on technology shares in that session, while the closing price marked the level recorded for the company's shares in the following session. Chief Executive Mark Zuckerberg said the company's investments are paying off and its core business is strong. Chief Financial Officer Susan Li said the new class "will expand our financing tools and give us flexibility to invest in the unprecedented momentum we are seeing across every part of our AI-driven business."
Meta expects fourth-quarter 2026 revenue of $73 billion to $76 billion, according to its filing with the U.S. Securities and Exchange Commission. As a later financing step, the company plans an at-the-market share-sale program of about $60 billion after Class C shares begin trading, which is expected in the first quarter of 2027, according to Reuters. Meta did not specify the program's terms or final timing. The program is separate from the two current offerings and keeps open the option of raising additional financing after the new class begins trading. The first-quarter 2027 date marks the next milestone in the company's announced financing plan.