NVIDIA Proposes $3 Billion Investment in Meta Share Offering Amid AI Expansion
Key Facts
NVIDIA said on October 26 that it would invest $3 billion in Meta’s share offering, describing the investment as proposed and subject to closing conditions. The announcement coincided with plans by the two companies to expand their work on Muse models, while Meta intends to expand its deployment of NVIDIA infrastructure for next-generation AI agents. Meta announced two concurrent public offerings the same day, one of Class A common stock and the other of mandatory convertible preferred shares. The company initially valued the two offerings at about $35 billion. Meta said the proceeds would be used for general corporate purposes, meaning the funding is not exclusively earmarked for AI infrastructure.
The size of the offering changed after the initial announcement: Meta raised the value of the common-stock offering from $22.5 billion to $25 billion and set the share price at $625. Including the preferred-share offering, total proceeds could reach $37.5 billion, according to Investing.com. Meta also plans to launch an at-the-market offering program of about $60 billion in Class C shares after they begin trading. The company had not specified the timing, size or final terms of that program. An analyst at Mizuho said the equity financing could ease some funding pressure, noting that some investors had been concerned about waiting for the Class C shares to be established in January 2027.
The fundraising comes as Meta expects capital expenditure of between $135 billion and $145 billion in 2026 to support infrastructure and computing capacity tied to AI opportunities. Capital expenditure, including repayments of finance lease principal, was $34.91 billion in the third quarter. By comparison, the company said it generated $97 billion in operating cash flow during the first nine months of the year. Cash, cash equivalents and marketable securities totaled about $82 billion at the end of the third quarter. These figures show the offering is part of a broader funding plan to meet spending needs, alongside the liquidity and cash flows reported by the company.
Meta plans to expand its deployment of NVIDIA infrastructure, including Vera Rubin and Vera CPUs for next-generation AI agents, as well as Spectrum-X Ethernet and BlueField-4 networking. The companies also said they would expand their work on Muse and its model family to improve training and inference performance. This links NVIDIA’s proposed investment in the offering to broader technical cooperation between the companies, as Meta incorporates computing needs into its capital plans. NVIDIA said its investment is tied to the share offering, while Meta said the proceeds are for general corporate purposes. The materials in the announcement did not specify how much spending would go to any particular product or project.
The expansion plans are underpinned by growth in Meta’s business: revenue was about $64.601 billion in the third quarter of 2026, up 26% year over year. Net income was $9.860 billion, up 264% from the same period a year earlier. The quarter’s results, however, included a $9.89 billion charge related to litigation settlements with state attorneys general. The company said diluted earnings per share would have been $7.40 excluding the charge. The average number of daily active people across Meta’s apps was about 3.64 billion in September, up 3% year over year, according to the company’s results.
The funding announcement followed declines in both companies’ shares amid concerns about the cost of AI projects and their expected returns. On October 22, Meta shares fell 7%, their biggest drop since July, while NVIDIA shares declined 4%, according to Reuters via Investing.com. At the October 29 close, Meta shares stood at about $624.52 and NVIDIA shares at about $213.66. These closing prices reflect the shares’ levels that day and do not by themselves determine the effect of the proposed investment announcement. NVIDIA is scheduled to hold its fiscal 2027 third-quarter earnings call on November 17, 2026.