Meta Plans Up to $95 Billion in Stock Sales to Fund Its AI Buildout
Meta on October 26, 2026 launched about $35 billion of public stock offerings and said it plans a further $60 billion share sale program, as AI spending pushes its 2026 capital expenditures toward $145 billion.
Key takeaways
- Meta launched about $35 billion of underwritten stock offerings on October 26, 2026: $22.5 billion of Class A common stock sold through forward sale agreements and about $12.5 billion of mandatory convertible preferred stock.
- Meta plans an at-the-market program of up to $60 billion in new non-voting Class C shares, not before the first quarter of 2027, but says it has no agreement and the program may not happen on those terms or at all.
- Nvidia, AMD and Broadcom have indicated non-binding interest in buying up to $5 billion of the Class A shares, Meta said.
- The raise follows a third quarter with negative free cash flow of $2.12 billion and a 2026 capital expenditure forecast of $135 billion to $145 billion.
Meta Platforms on October 26, 2026 launched about $35 billion of public stock offerings to fund its AI infrastructure, and said it plans to raise up to $60 billion more by selling shares on the market from 2027. The first $35 billion pairs $22.5 billion of common stock with about $12.5 billion of convertible preferred stock, according to Meta's announcement, filed with the US Securities and Exchange Commission.
The AI funding plan comes four days after Meta reported negative free cash flow for the third quarter. Meta says the money supports its investment in AI infrastructure and what it calls personal superintelligence, including its Muse AI agent and the Muse Wonder frontier model. Meta shares were down 1.6% in morning trading after the news, CNBC reported.
What exactly is Meta selling?
Meta announced two concurrent underwritten offerings on October 26, 2026 worth about $35 billion together, plus a separate $60 billion at-the-market program it intends to set up later, a split the Wall Street Journal also reported. Morgan Stanley and Goldman Sachs lead the deals.
The first offering is $22.5 billion of Class A common stock sold through forward sale agreements with Morgan Stanley and Goldman Sachs affiliates. Under a forward sale, the banks sell the shares now and Meta delivers new shares and collects the cash later, on dates it chooses up to November 19, 2027. Meta says it does not expect to receive any money from this offering at first.
The second is 250 million depositary shares, each a one-twentieth interest in a new Series A Mandatory Convertible Preferred share with a $1,000 liquidation preference, which works out to $50 per depositary share by this site's arithmetic. The preferred stock converts automatically into common stock on or about August 15, 2029. The dividend rate and conversion terms will be set at pricing.
Underwriters have 30 day options to buy up to 37.5 million more depositary shares and $3.375 billion more common stock.
| Class A common stock | Mandatory convertible preferred | At-the-market program | |
|---|---|---|---|
| Size | $22.5 billion | About $12.5 billion (250 million depositary shares) | Up to about $60 billion |
| Share class | Voting Class A | Converts to Class A, or Class C once it exists | Non-voting Class C |
| Timing | Cash on settlement dates up to November 19, 2027 | Converts to common stock on or about August 15, 2029 | First quarter of 2027 at the earliest |
| Status | Launched | Launched | No agreement signed; size, timing and terms not set |
Why is Meta selling stock instead of only borrowing?
Meta says it wants to fund AI through "a balanced mix" of operating cash flow, investment grade debt, partnerships and equity, and calls the new stock sales a complementary source that diversifies its funding. The backdrop is its spending: Meta expects capital expenditures of $135 billion to $145 billion in 2026.
It generated $97 billion of operating cash flow in the first three quarters of 2026 and held about $82 billion in cash, cash equivalents and marketable securities at the end of September, the company said.
Investors had already flagged the strain. On October 22, Meta shares fell nearly 7% after the company reported negative free cash flow of $2.12 billion for the third quarter and raised the bottom of its capex range from $130 billion, and the spread on its five year credit default swaps hit an all time high, CNBC reported. If all $95 billion is raised, it would equal roughly two thirds of the 2026 capex forecast, by this site's arithmetic.
Others are raising too: Alphabet said in June it would look to raise $85 billion, and SpaceX closed a $40 billion debt financing to buy graphics processors, according to CNBC.
Who are the cornerstone investors?
Nvidia, AMD and Broadcom have each indicated interest in buying Class A shares in the offering, up to $5 billion combined, at the same price as other buyers, Meta said. The indications are not binding, so any of the three may buy more, fewer or no shares.
Two of the three already sell to Meta. Meta's engineering team wrote on October 19, 2026 that Prometheus, its gigawatt scale training cluster in New Albany, Ohio, runs two generations of Nvidia GPU platforms with a third on the way, and that its regional network uses Broadcom Jericho3 chips. Read together, the two documents show Nvidia and Broadcom offering to invest in a customer that buys their hardware for its largest AI cluster.
How does the new Class C stock fit in?
The planned $60 billion program depends on a share class that does not trade yet: non-voting Class C common stock, which Meta's board approved on October 19, 2026 and which takes effect on January 19, 2027, according to a Meta 8-K filing. Every Class A and Class B shareholder will receive one Class C share per share held as a one time dividend.
Class A shares carry one vote and Class B shares ten, and entities controlled by chief executive Mark Zuckerberg hold most of the Class B stock, according to The Decoder. Selling non-voting shares lets Meta raise capital without diluting that control. The 8-K also describes a Founder Alignment Agreement that limits Zuckerberg's ability to sell 80% of his own Class C shares unless he sells or converts a matching number of his voting shares.
Once Class C exists, Meta may in certain circumstances settle the forward sales in Class C shares only, and the preferred stock would convert into Class C, the announcement says.
What we don't know yet
- The price of the Class A shares and the dividend rate and conversion terms of the preferred stock, which will be set at pricing.
- Whether Nvidia, AMD and Broadcom will buy, and how much each.
- Whether the $60 billion at-the-market program will launch, when, and on what terms; Meta says none of this is settled.
- How much new debt Meta still plans to issue alongside the stock sales.
FAQ
What is an at-the-market program?
An at-the-market program lets a company sell new shares gradually on the stock exchange at prevailing prices through a bank acting as sales agent, instead of in one priced offering. Meta says its program would sell only Class C shares and would run from 2027 at the earliest.
What is a mandatory convertible preferred share?
It is a preferred share that pays a dividend and must turn into common stock on a set date, here on or about August 15, 2029. The number of common shares each one becomes depends on the stock price near conversion, within limits set when the deal is priced.
Where will the new preferred shares trade?
Meta intends to apply to list the depositary shares on the Nasdaq Global Select Market under the symbol METAM. There is no public market for them or for the underlying preferred stock yet, Meta said.
Sources
- Meta Announces Launch of Offering of Depositary Shares Representing Series A Mandatory Convertible Preferred Stock and Offering of Class A Common Stock in Connection with Forward Sale Agreements Meta (SEC filing) · sec.gov
- Meta announces $95 billion stock offering to fund AI expansion CNBC · cnbc.com
- Meta Platforms Form 8-K: Class C common stock and Founder Alignment Agreement Meta (SEC filing) · sec.gov
- Meta stock sinks nearly 7% as AI spend pushes free cash flow negative CNBC · cnbc.com
- Meta plans up to $95 billion in stock sales to fund its AI buildout The Decoder · the-decoder.com
- Inside Prometheus: Meta's Journey to a Gigawatt-Scale Supercluster Meta Engineering · engineering.fb.com
- Meta Plans $35 Billion Stock Offering to Power AI Buildout, Eyes $95 Billion Total Plan The Wall Street Journal · wsj.com · paywalled, headline only
Toto, AI Editor
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