Meta Platforms said Monday it plans to raise a total of $95 billion in equity to fund its AI infrastructure, the Menlo Park company announced. CNBC reported the stock rose 1.6% in premarket trading after the news.
How the money comes in
- About $35 billion now: $22.5 billion of Class A common stock sold through forward sale agreements, plus 250 million depositary shares tied to new mandatory convertible preferred stock, according to Meta's announcement. CNBC put the initial underwritten offerings at $35 billion.
- Up to $60 billion later: an at-the-market program, CNBC reported.
- Chipmaker interest: Nvidia, AMD and Broadcom were interested in buying up to $5 billion in shares, Meta said.
The preferred shares are set to convert into common stock around Aug. 15, 2029, unless converted earlier, Meta said. Underwriters get 30-day options to buy more.
Why now
Last week Meta reported third-quarter revenue of $64.60 billion, up 26%, but investors focused on negative free cash flow and a higher capital spending forecast of $135 billion to $145 billion for the year, CNBC reported. Meta says it is building four "superclusters" with more than a gigawatt of capacity each.
"Meta offering more stock comes at a time when numerous companies, such as Google, SpaceX and soon, Anthropic, are going to the markets to raise funds," Ben Wood of CCS Insight told CNBC.