Meta Approves One Nonvoting Share for Each Outstanding Share, Sets New Class Effective Date for January 19
Key Facts
Meta announced the creation of publicly traded, nonvoting Class C common stock, with one share to be distributed for every outstanding Class A and Class B share, according to a company filing with the U.S. Securities and Exchange Commission. The amended charter establishing the new class is scheduled to take effect on January 19, 2027. The company said the price of Class A shares will reflect the effect of a 2-for-1 split after the distribution is paid. The board has not yet set the record date for eligible shareholders or the payment date. The new structure allows Meta to issue additional shares for financing and operational purposes while keeping the voting rights associated with Class A and Class B undiluted by the initial distribution.
Meta cited raising capital, employee compensation and funding potential acquisitions, along with other general corporate purposes, as possible uses. In its filing, the company said the new class would enable those uses without diluting the voting power of Class A and Class B. This differs from a traditional stock split: the 2-for-1 effect applies to the price of Class A shares after the distribution, while shareholders receive a share in another class that carries no voting rights. The announcement therefore does not mean the company has already issued new shares to raise funds; it establishes a class that can be used for those purposes. The move comes as Meta expands its investment in artificial intelligence and its core business.
Mark Zuckerberg already holds about 60.6% of Meta's total voting power, according to the company's ownership filing as of October 1, 2026. That figure puts the change in the context of maintaining the existing voting structure, rather than rescuing control that is under imminent threat. The company said issuing and later using Class C shares would not dilute the voting power of Class A and Class B. At the same time, the new shares give Meta flexibility in compensation, capital raising and potential acquisitions. The filing did not specify a target amount of financing the company might raise through the new class.
The share restructuring comes alongside a major expansion in capital spending tied to artificial intelligence efforts and the core business. Capital expenditures, including principal payments on finance leases, totaled $34.91 billion in the third quarter of 2026. Meta raised its full-year capital spending forecast to a range of $135 billion to $145 billion. The company said the spending supports its AI efforts and core business, and expected to continue investing heavily in 2027 to support its existing business and emerging AI initiatives. The company also linked continued spending to opportunities in new models and products, which it said are positioning it to sustain strong revenue growth during the year.
Meta recorded revenue growth alongside that spending, with third-quarter 2026 revenue of about $64.601 billion, up 26% from $51.242 billion in the same period of 2025. Mark Zuckerberg said the company made major progress during the quarter toward delivering "personal superintelligence for everyone." He cited the launch of Muse and Muse Wonder, describing them as the company's first two frontier models. The results provide an operating backdrop for the investment plans the company announced, while the new class allows shares to be used for compensation and capital raising. Meta did not link the distribution to a specific amount of spending or financing in its filing.
Meta had forecast total revenue of between $73 billion and $76 billion in the fourth quarter of 2026, assuming foreign exchange would be a headwind of about 1% to annual revenue growth. In trading, the stock rose 0.5% in the regular session on October 21, then gained 2.9% in extended trading after the results announcement, according to the Associated Press. It subsequently fell from a closing price of $694.25 on October 20 to $630.56 on October 26, according to EL7 data. Under the announced schedule, the amended charter takes effect on January 19, 2027, with payment to occur no later than the fifth business day thereafter. The board still has to set the record date and payment date.