Meta to raise $95 billion in stock sales for AI buildout

Meta will raise a total of $95 billion through new stock sales to fund its expanding artificial intelligence infrastructure. The company announced the plan on Monday, citing the need to support its superintelligence goals and emerging AI opportunities. Shares of the tech giant fell 1.6% in morning trading following the news.

The funding strategy is split into two phases. Meta will first issue $35 billion through underwritten public equity offerings. It will then seek an additional $60 billion via an at-the-market program, which allows the company to sell shares at prevailing market prices over time. Meta stated that Nvidia, Advanced Micro Devices, and Broadcom are interested in buying up to $5 billion of these shares.

This move follows a recent shift in how major technology companies finance their growth. Meta is joining a group of hyperscalers that are increasingly using debt and equity markets to cover the high costs of the AI boom. Last week, the company reported third-quarter results that showed revenue grew 26% year over year to $64.60 billion. This figure exceeded the $63.37 billion analysts had predicted. However, investors reacted negatively to the company's negative free cash flow and a higher forecast for annual spending.

Meta now expects its full-year capital expenditure to fall between $135 billion and $145 billion. The company raised the lower end of that range from $130 billion, which contributed to a drop in its stock price earlier in the week. The company said it is building four data center superclusters, each with a capacity of more than 1 gigawatt. It is on track to nearly double its total infrastructure capacity in 2026 compared to the previous year.

Goldman Sachs estimates that AI-related capital spending across compute, data centers, and power could reach $7.6 trillion between 2026 and 2031. Ben Wood, a senior partner at CCS Insight, described the required investment levels as eye-watering. He noted that Meta is joining other major firms in seeking capital from the markets.

Alphabet, the parent company of Google, indicated in June that it would look to raise $85 billion. SpaceX has already closed a $40 billion debt financing deal to purchase graphics processing units. Anthropic is also preparing for an initial public offering. Meanwhile, TikTok U.S. is seeking multiple gigawatts of computing capacity in the coming years, according to a report released Friday.