Meta plans up to $95 billion in stock sales to fund AI spending

Meta is turning to the stock market to pay for its AI build-out. On Monday, 26 October, the company said it plans to raise up to $95 billion from share sales to fund its artificial intelligence investments, according to DPA's report on the announcement.

Summaries of the announcement, which have not been independently verified, describe the raise as starting with $35 billion in underwritten public equity offerings, followed by $60 billion through an at-the-market programme. Those summaries say Meta plans to balance the spending with operating cash flow, investment-grade debt, partnerships and equity.

Meta said Nvidia, AMD and Broadcom had expressed interest in buying up to $5 billion of shares combined, about 5% of the headline figure. Meta was clear about the status of those expressions: they were "neither binding agreements nor firm purchase commitments."

The announcement follows third-quarter results. Summaries say revenue rose 26% and that investors have focused on negative free cash flow and higher capital spending. The same summaries say Meta projected full-year capital expenditure of $135 billion to $145 billion. Shares reportedly fell about 1.6% in morning trading after the announcement.

Reports differ on the instruments. A Bloomberg report, as summarised in a Yahoo Finance video, says Meta is selling common and preferred stock, and that a new non-voting share class could allow some stock to be sold without diluting Mark Zuckerberg's stake. One summary describes the preferred as convertible; the others do not specify.

The raise shows how much of Meta's AI build-out now depends on outside capital. Equity is one of several funding sources the summaries list, and it is the only one that dilutes existing holders. The chipmakers have the most to watch: their interest is non-binding, so the reported $5 billion is a signal rather than a sale.

Existing shareholders are the exposed group. If the non-voting class goes ahead as reported, Zuckerberg's stake is protected from dilution while other holders bear it. Investors should watch whether the chipmakers' interest becomes firm, how the offering is priced, and whether the $135 billion to $145 billion capex guidance is matched by free cash flow.