Meta plans to sell $95 billion in stock to fund its AI push

Meta announced a $95 billion stock sale plan

Meta announced a new stock sale plan on October 26 to keep investing in AI infrastructure and “personal superintelligence.” According to its SEC filings, the first stage is about $35 billion: roughly $22.5 billion in Class A common stock and $12.5 billion in depositary shares representing mandatory convertible preferred stock.

The second part is an at-the-market program of about $60 billion, in which shares are sold gradually at prevailing market prices. It will use new non-voting Class C shares and is not expected to start before the first quarter of 2027. Meta said it has not signed an agreement for the program yet and that there is no assurance it will be established. The $95 billion figure is the sum of the two parts.

The sale priced at $625 and was upsized

Meta’s pricing term sheet shows the Class A sale was upsized to $25 billion. It sold 40 million shares at $625 each, after the stock closed at $630.56 on October 26. Bloomberg reported that orders reached about five times the shares on offer and that the plan’s total rose to nearly $98 billion.

The Class A shares are sold through forward sale agreements. Morgan Stanley and Goldman Sachs borrow and sell the shares, and Meta receives the money on settlement by November 19, 2027. On the preferred side, Meta sold 250 million depositary shares at $50 each. They pay a 6.50% annual dividend and convert into Class A stock in August 2029.

Class C shares and Zuckerberg’s control

Meta announced the non-voting Class C stock with its third-quarter results on October 21. It will distribute one Class C share for each Class A and Class B share, which the company says changes no one’s voting power. Meta says it will use the new class for raising capital, employee pay and possible acquisitions.

According to Business Insider, Meta said Class C shares would let founder Mark Zuckerberg pay California’s proposed wealth tax without giving up voting control. Meta also signed a “Founder Alignment Agreement” with Zuckerberg that covers his sales of Class C shares.

Nvidia buys $3 billion, AMD $1 billion

The filings say Nvidia, AMD and Broadcom indicated interest in buying up to $5 billion of Class A stock in aggregate, and that these indications are not binding. Nvidia said it will invest $3 billion. SiliconANGLE and Bloomberg report that AMD is buying $1 billion, while Broadcom has not disclosed an amount.

The investments come with hardware deals. Nvidia says Meta will expand its use of Vera Rubin systems and Vera CPUs and deploy Spectrum-X Ethernet and BlueField-4. The two companies will also work to improve training and inference performance for Meta’s Muse models and its Muse agent. “Muse is how we bring personal superintelligence to everyone,” Zuckerberg said in Nvidia’s release.

According to SiliconANGLE, Meta has deployed an initial set of AMD’s Helios racks, based on the Instinct MI450, and is testing them. Earlier this year, Meta and AMD agreed to deploy up to 6 gigawatts of AMD GPUs. In that deal, AMD gave Meta a performance-based warrant for up to 160 million AMD shares.

Spending outran cash flow

Meta’s third-quarter revenue was $64.6 billion, up 26% according to Business Insider. Operating income was $13 billion. Capital expenditures, including finance lease payments, reached $34.9 billion. With $32.8 billion in operating cash flow, free cash flow was negative $2.1 billion.

The company narrowed its 2026 capital spending outlook to $135 billion to $145 billion, raising the low end from $130 billion. At the end of September it held $82.5 billion in cash and marketable securities, and its prospectus puts total debt at $83.7 billion. Meta says it will fund its buildout with a “balanced mix” of operating cash flow, investment-grade debt, strategic partnerships and equity.

The Financial Times reported that Meta has told investors it will need to raise “hundreds of billions of dollars” over several years for AI. Bloomberg reported that Meta shares fell as much as 1.4% to $621.47 on October 27.