Meta prices $37.5B of new stock, the first step of a $95B plan to pay for AI

Meta has started selling stock to pay for artificial intelligence, and it is doing it on a scale that few companies have ever attempted. On Monday, October 26, the company announced a financing plan built around about $35 billion of underwritten stock offerings and a later program worth roughly $60 billion. A few hours later the first part was already priced, and it came in bigger than planned: according to the pricing announcement, the common stock offering was upsized from $22.5 billion to $25 billion at $625 per share.

Together with $12.5 billion of new preferred stock, Meta has now lined up $37.5 billion in one evening. If the follow up program goes ahead as described, the whole plan reaches roughly $97.5 billion. CNBC and other outlets rounded it to $95 billion, which was the size before the upsizing. Either way, it is an unusually large stock sale for any listed company, and it is explicitly tied to AI infrastructure and what Meta calls personal superintelligence.

This article walks through what Meta is actually selling, why a company with $82 billion in cash still needs the money, who wants to buy, and what the new share class means for control of the company.

What Meta is selling

The plan has three parts, and they are quite different instruments.

The first is a classic block of common stock, but with a twist. Meta is selling $25 billion of Class A shares through so called forward sale agreements with Morgan Stanley and Goldman Sachs. The banks borrow shares and sell them to investors now, at $625 each. Meta itself does not get the money today. It delivers 40 million new shares to the banks later and receives about $622.92 per share at that point, which comes to roughly $24.9 billion before expenses. Meta can settle these forwards on one or more dates of its choosing, as late as November 19, 2027. That gives the company a locked in price without having to take the cash, and the dilution, before it actually needs it.

The second part is $12.5 billion of what Meta calls depositary shares. Each one represents a twentieth of a new 6.50% Series A mandatory convertible preferred share. Investors receive a fixed dividend every quarter from February 2027, and on or around August 15, 2029 each preferred share automatically turns into common stock. The conversion rate floats between 1.3620 and 1.6000 shares of Class A stock per preferred share, depending on where the stock trades in the summer of 2029. The depositary shares are meant to list on Nasdaq under the ticker METAM. Meta expects both offerings to close on October 29.

The third part is the biggest and the least certain: an at the market program of about $60 billion. In an at the market program, a company sells new shares gradually into the open market through brokers instead of in one large block. Meta says it plans to launch it once its new Class C shares start trading, which is not expected before the first quarter of 2027. The company is careful to add that it has signed no agreement yet, that timing, size and terms are open, and that the program may not happen at all.

On top of that, the underwriters got the usual 30 day options. For the preferred shares that is up to 37.5 million more depositary shares, worth about $1.9 billion. For the common stock it is up to $3.75 billion more. If both options are fully used, the immediate raise grows past $43 billion.

Nvidia, AMD and Broadcom want in

One detail stands out in the launch announcement. Nvidia, AMD and Broadcom, which Meta calls cornerstone investors, indicated an interest in buying up to $5 billion of the common stock in total, at the same price and on the same terms as everyone else.

That is a striking arrangement. These three companies sell Meta the GPUs, accelerators and networking equipment that its data centers run on. Meta's money flows to them as revenue, and part of it now may flow back to Meta as equity. The indications are not binding, so each of them can buy more, less or nothing. But the signal is clear: the chip suppliers have a strong interest in keeping their largest customers able to spend.

This kind of circular flow is exactly what a recent Bank for International Settlements bulletin looked at. It found that more than half of the capital flowing into AI firms between 2021 and 2025 came from other AI firms. Meta's deal is not the same kind of investment, because a few billion dollars is a small share of a roughly $97 billion plan. Still, it fits the pattern of suppliers and customers financing each other.

Why a company this rich needs outside money

Meta is not short of money in the usual sense. The company said 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. Third quarter revenue was $64.6 billion, up 26% from a year earlier, and net income was $9.9 billion.

The problem is the size of the spending plan. Meta now expects capital expenditures of $135 billion to $145 billion in 2026. It raised the bottom of that range from $130 billion with its third quarter results last week, and investors focused on negative free cash flow, according to CNBC. That sent the stock lower. On Monday the stock fell another 1.6% in morning trading after the offering was announced.

The money goes into physical infrastructure. Meta says it owns data centers in 23 US states, is building four superclusters with more than one gigawatt of capacity each, and is on track to nearly double its total infrastructure capacity in 2026 compared with 2025. It is also investing in custom silicon to cut the cost of compute.

Meta frames the stock sale as one piece of a balanced mix. It plans to fund its buildout through operating cash flow, investment grade debt, strategic partnerships and equity. The company points out that its Aa3 and AA minus credit ratings let it borrow cheaply, and it calls the equity program a complementary source that diversifies its funding. Put more simply: Meta has already been borrowing heavily, and adding a large amount of equity keeps its debt load and credit rating in a comfortable place while the spending continues.

What Meta says it is building

The announcement doubles as a pitch to investors, and it lists the products the money is supposed to support.

Meta says 3.64 billion people used at least one of its apps every day as of September 2026, that engagement on Facebook and Instagram is at all time highs, and that it has delivered six straight quarters of more than 20% revenue growth, partly thanks to AI driven improvements in recommendations and ads.

For its newer AI products, Meta says it signed up more than 10 million users of its Muse assistant in the US and Canada in the first weeks after launch, with shopping as the leading use case for more than 25% of weekly active users. More than 2 million businesses use its Business Agent every week, and people have more than 30 million conversations with these agents weekly. Meta also wants to sell inference to businesses through its new Meta Enterprise Platform, using models such as Muse Wonder, its first frontier model, plus an API and a coding product called Muse Code.

These numbers explain the logic of the bet. Meta's core advertising business is still growing quickly and pays for most of the spending. The new revenue from agents, enterprise products and AI glasses is still small compared with the infrastructure bill. The stock sale buys time until those businesses either grow into the investment or do not.

The new share class and Zuckerberg's control

The timing is no coincidence. A week earlier, on October 19, Meta's board approved a new class of non voting Class C common stock, and shareholders approved it by written consent the next day, according to an SEC filing. The new charter was filed in Delaware on October 21 and takes effect on January 19, 2027. Every existing Class A and Class B share will receive one Class C share as a dividend, which works much like a two for one stock split.

Class A shares carry one vote, Class B shares carry ten votes, and Class C shares carry none. That matters because Mark Zuckerberg controls Meta through his Class B shares. As of October 1, 2026, he owned about 13.4% of the company but controlled about 60.6% of the votes, according to the filing as summarized by Reuters.

With non voting shares, Meta can sell large amounts of stock, pay employees and fund acquisitions without shrinking that voting power. Reuters reported that Meta's special committee called the preservation of Zuckerberg's leadership a key objective and said he would not support a significant equity financing that reduced his voting control. The committee proposed sunset rules that would have turned his super voting shares into normal shares on certain triggers, but Zuckerberg indicated he would not support them. Under a separate Founder Alignment Agreement, only 20% of the Class C shares he receives can be sold freely. The rest can only be sold if he gives up a matching amount of voting stock.

This is why the $60 billion at the market program waits for Class C trading. Once those shares exist, Meta can keep feeding non voting stock into the market for years. Even the preferred stock sold now is designed to convert into Class C shares instead of Class A once the new class exists, and the forward sales can be settled in Class C stock too. Alphabet has used a similar structure for years.

Part of a wider wave

Meta is not alone. CNBC points out that Alphabet said in June it would look to raise $85 billion, SpaceX closed a $40 billion debt financing to buy graphics processors, and Anthropic is preparing its stock market debut. Goldman Sachs estimates that AI related capital spending could reach about $7.6 trillion from 2026 through 2031, across compute, data centers and power.

Ben Wood of CCS Insight told CNBC that the raise "reflects the eye watering levels of investment required to keep up in the AI arms race." That is the core of it. For years the largest tech companies paid for their data centers out of cash flow and still bought back stock. Now even the richest of them are turning to debt markets, chip supplier deals and, in Meta's case, a historic amount of new shares.

What it means for shareholders

For existing shareholders, the trade is dilution now in exchange for capacity later. The 40 million shares in the forward sales and the shares that the preferred stock will eventually turn into are new stock. A $60 billion program on top would add more. Meta argues that its AI investments already produce returns through engagement and ad performance, and that the new products will add revenue. The stock's drop after the announcement shows that not every investor is convinced yet.

For the AI industry, the message is that the buildout is not slowing down. A company that already spends more than $135 billion a year on infrastructure is raising tens of billions more to keep going, and its suppliers are offering to help pay for it. Whether that looks like confidence or like a warning sign depends on how quickly the products built on top of these data centers start paying their own way.

Sources

• Meta: launch announcement of the offerings and financing plan, October 26, 2026
• Meta via PR Newswire: pricing announcement, October 26, 2026
• SEC: Meta 8-K on the Class C recapitalization and prospectus supplement
• CNBC: Meta announces $95 billion stock offering to fund AI expansion
• The Decoder: Meta plans up to $95 billion in stock sales
• Reuters via Investing.com: Why is Meta creating a new class of non voting shares