Meta Ties 2‑for‑1 Split to Up to $97.5B Raise

Meta Platforms has unveiled a financing and share‑structure plan that combines an effective 2‑for‑1 stock split with potential capital raising of up to $97.5 billion. The company will issue a new nonvoting Class C share as a stock dividend, granting one Class C share for each existing share, and creating the same security it plans to sell through a future at‑the‑market program. Alongside this, Meta has priced $25.0 billion of Class A common stock and $12.5 billion of mandatory convertible preferred shares, bringing the total immediate underwritten offering to $37.5 billion. A planned Class C at‑the‑market program could add up to a further $60.0 billion of capacity once it begins.

The Class C shares are intended to qualify for listing on Nasdaq after issuance, with the new nonvoting structure scheduled to take effect on January 19, 2027. Meta has indicated that trading in the Class C shares is expected to start in late January 2027, effectively delivering the stock split to existing holders. The at‑the‑market Class C program has no agreement or confirmed sales yet and is not expected to begin before the first quarter of 2027, leaving the eventual amount of new equity and resulting dilution to be determined.

The overall funding capacity is built from underwritten offerings and a possible $60 billion of Class C issuance, a combined $95 billion figure that was later increased when the common stock component was raised to $25 billion.

The financing plan arrives as Meta steps up investment in artificial intelligence infrastructure. The company expects 2026 capital expenditures of $135 billion to $145 billion, and the $95 billion funding capacity previously outlined equaled 67.9% of the midpoint of that guidance. A separate agreement includes a $3 billion commitment from NVIDIA (NVDA) to purchase Meta shares as part of the expanded stock offering, further linking the capital raise to Meta’s AI collaboration and infrastructure build‑out.

Meta’s latest quarterly results provide context for the decision to broaden its equity funding options. Third‑quarter revenue reached $64.60 billion, up 26.1%, while operating margin declined to 20% from 40% a year earlier. The period included a $9.89 billion legal charge that weighed on profitability and contributed to GAAP diluted earnings per share of $3.83. Total expenses rose 68% to $51.61 billion, and third‑quarter capital expenditures were $34.91 billion.

The company ended September with $82.4 billion in cash and marketable securities and $83.7 billion in debt, and operating cash flow over the first nine months of the year was approximately $97 billion. Despite the sizable cash position, third‑quarter free cash flow was negative $2.12 billion, and Meta reported no share repurchase outflow in the June and September 2026 quarters after spending $26.248 billion on buybacks in fiscal 2025. Instead, it paid $1.36 billion in dividends in the third quarter and is now preparing to issue new equity through the underwritten offerings and the prospective Class C program, which will increase the share count once executed.

Management has highlighted that earnings per share will depend on whether total earnings growth can outpace the expansion of Meta’s share base across Class A, Class C and the eventual conversion of mandatory convertible preferred stock. The company’s plan keeps voting control concentrated while opening multiple channels to fund its AI capital program. Near‑term milestones include the expected closing of the current offerings on October 29, 2026, and the launch of the new Class C structure and potential at‑the‑market issuance starting in 2027.