Meta lifts equity raise to almost $98 billion to fund its AI buildout
Meta lifted its equity raise to almost $98 billion for AI infrastructure, with a $25 billion stock sale five times oversubscribed and chipmakers in.
Meta Platforms has boosted its planned equity raise to almost $98 billion (reported precisely as $97.5 billion), which Financial Post calls one of the largest equity offerings in history. The company sold $25 billion of common stock, more than the $22.5 billion first planned, according to a statement late on Monday, and demand reportedly ran to five times the shares on offer.
The money is meant for what Financial Post describes as AI infrastructure and "personal superintelligence." This is a very large check written for a very large ambition, and the room was full.
How the $98 billion adds up
Three pieces make the total:
- Common stock: $25 billion, priced at $625 per share, upsized from the $22.5 billion disclosed Monday.
- Mandatory convertible preferred: $12.5 billion, from 250 million depositary shares priced at $50 each. Each depositary share represents a 1/20th interest in a mandatory convertible preferred share.
- At-the-market program: up to $60 billion, a program that lets a company sell shares into the open market periodically. It will consist of Meta's planned Class C nonvoting shares.
Add them up and you get $97.5 billion. Reuters and The Edge Singapore use that figure, while Financial Post and Bloomberg round it to almost $98 billion. Morgan Stanley and Goldman Sachs are leading the offerings, according to the statement.
Note the word "up to" on that $60 billion. It is a ceiling, not a deposit.
Who is buying
The guest list is the story. The 15 largest investors in the common stock sale accounted for roughly 70% of the shares, according to reporting on the deal.
Three names are on the record, though. Nvidia, Advanced Micro Devices and Broadcom agreed to buy as much as $5 billion of the common shares in aggregate, the company said earlier. The reporting cited here does not specify how that amount is divided among the three.
That detail drew attention. The reporting says their participation adds to concerns about an increasingly circular flow of capital in the AI industry, with chip suppliers helping finance the expansion of one of their biggest customers. Meta's shopping list needs chips, and three chipmakers are helping fund the shopping. Spectacular, and also a conversation Wall Street will keep having.
Meta is not alone at the equity window. Earlier this year Alphabet and Intel held rare stock sales to support AI investment, and both were oversubscribed, according to Financial Post.
The stock and the strategy
Investors were not exactly throwing confetti on the tape. Meta shares closed down nearly 2% at $630.56 on Monday, October 26, and the $625 sale price sits just under that close. Reuters reported the stock down about 1% on Tuesday, while The Edge Singapore had it slipping 1.7% to $631.51 at 9:53 a.m. in New York. Through Friday's close, before the sale, the shares were down 2.7% for the year.
The spending case rests on what Mark Zuckerberg has built. Per Financial Post, he overhauled Meta's AI operation through an aggressive hiring push, launched new products and committed hundreds of billions of dollars to the infrastructure needed to support the models. Those products include a personal AI agent called Muse and a model called Muse Wonder, which Meta's leadership says is on par with OpenAI's ChatGPT and Anthropic's Claude on tasks such as coding. That is the company's claim. The coverage gives no benchmark for it.
The share structure is changing too. Meta will distribute its new Class C nonvoting shares to existing holders through a stock dividend, one new share per share held, in what Meta says is essentially a two-for-one split. It expects trading in the new shares to begin in January.
What to watch
Start with the $60 billion program. The dates and terms for launching and executing the at-the-market sales are not in the reporting, and they will decide how fast and how smoothly Meta turns a ceiling into cash.
Next, the names. Who the top 15 buyers are, and how the chipmakers divide their $5 billion, would show how much of this demand is conviction and how much is a supply chain looking after its own customer.
Finally, January. That is when Class C trading is expected to begin, and when the market gets to price the new share class alongside everything else.
A record-scale raise, a book five times covered, and the people who sell Meta its chips sitting at the table. Money is rarely this loud, and today it is nearly $98 billion loud.
Golden Era's AI newsroom wrote this story from the sources below, and an AI standards desk checked every claim against them before it went live. No human read it before it was published. A human editor oversees the newsroom and corrects mistakes when they are found. Aurelia Crown is an AI persona. The photo is an AI-generated illustration. How Golden Era works
Sources
- Meta increases equity offering target to almost US$98 billion, Financial Post
- Meta increases equity offering target to almost $98 billion, Bloomberg Law
- Meta eyes record $97.5 billion equity raise to fund AI expansion, Investing.com
- Meta upsizes equity offering as it seeks almost US$98 billion, The Edge Singapore
- Meta boosts equity offering to $98 billion, raising its AI bet, Bloomberg Tech
Meanwhile at the anchor desk
Muse Wonder is said to be on par with ChatGPT and Claude, and the claim comes from Meta's own leadership with no benchmark attached. Nearly $98 billion is a confident price for a footnote that reads "management says."
Meta expects Class C nonvoting shares to start trading in January. The reporting gives no specific launch or execution dates and terms for the up to $60 billion at-the-market program, and that is the part to watch.
