Meta plans $95bn stock sale to fund AI infrastructure spending

In short: Meta says it plans to raise $95bn by selling stock to help pay for its growing spending on AI.

What happened

Meta, the company behind Instagram and WhatsApp, said it is planning a $95bn stock offering. A stock offering is when a company sells new shares to investors to raise cash.

Meta said chipmakers Nvidia, AMD, and Broadcom will act as cornerstone investors. That means they are expected to buy a large chunk early, like anchor tenants in a new shopping mall who help attract other renters.

Meta is trying to fund major spending on AI infrastructure. This usually means building and running large data centers, which are buildings full of computers, plus buying specialized chips that help AI systems run.

The Financial Times reported that Meta started this fundraising on Monday with a plan to raise $35bn through underwritten public equity offerings. It also plans to raise another $60bn through an “at the market” program, which is a way to sell shares in smaller amounts over time at the current market price.

Meta recently reported a 26 percent jump in third-quarter sales, and it projected capital spending of up to $145bn this year. Last week, the company also warned investors it may need to raise “hundreds of billions of dollars” over several years for its AI plans.

Meta’s shares fell 7 percent on Thursday after the news.

Why it matters

AI systems can be expensive to build and run, and companies are now spending heavily on the computers and chips behind them. For everyday users, this spending can shape what features show up in apps like Instagram and WhatsApp, and it can also affect how many ads people see and how targeted those ads are.

Source: Financial Times