Meta Launches $35B Equity and Mandatory Preferred Raise, With $60B ATM to Follow

summarizeSummary

Meta is selling roughly $35 billion of stock in one shot: about $22.5 billion of Class A common shares through forward sale agreements with Morgan Stanley and Goldman Sachs, plus about $12.5 billion of depositary shares representing a new Series A mandatory convertible preferred, with a $1,000 liquidation preference per share across 250 million depositary shares, each 1/20th of a preferred share, and automatic conversion settled on or about August 15, 2029. On top of that, it plans a roughly $60 billion at-the-market program selling Class C stock once the new non-voting class begins trading, expected in the first quarter of 2027. The money funds AI infrastructure — Meta guides $135 to $145 billion of 2026 capex — and management points to $97 billion of operating cash flow through the first three quarters and about $82 billion of cash and securities at the end of Q3. This is a large supply of new shares for a company that just posted Q3 revenue of $64.6 billion, up 26%, with a $9.89 billion legal charge dragging operating income down 37%. The one offset is demand evidence: NVIDIA, AMD and Broadcom have indicated interest in up to $5.0 billion of the common at the offering price, though those indications are non-binding. Pricing terms for the preferred, including dividend rate and conversion terms, are still to be set, and Meta has filed a mixed securities shelf.

check_boxKey Events · Financing and Capital Events · META

auto_awesomeAnalysis · META · Technology