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Meta plans record $97.5bn share sale to fund its AI build-out

Nvidia and AMD are among the buyers, as the Facebook owner raises money for giant data centres. Critics see a circular flow of cash between AI companies and their suppliers.

By Newsheir Staff, Newsroom

· 2 min read

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In this article
  1. How the money will be raised
  2. Chipmakers buy in
  3. What the money is for
  4. Investor nerves

Meta, the owner of Facebook, Instagram and WhatsApp, plans to raise up to $97.5bn by selling shares, its largest fundraising ever, to pay for the data centres and chips behind its artificial intelligence ambitions.

The company increased the size of the planned offerings in late October.

How the money will be raised

The $97.5bn is made up of three parts:

  • $25bn in common stock, priced at $625 a share, up from $22.5bn disclosed earlier
  • About $12.5bn in convertible preferred shares, through the sale of 250 million depositary shares at $50 each
  • Up to $60bn in an "at-the-market" programme, selling shares gradually at prevailing prices. Sales are expected to begin after Meta's planned non-voting Class C shares start trading in the first quarter of 2027

Not all of the money has been raised yet; the at-the-market portion depends on future sales.

Chipmakers buy in

Nvidia and AMD, which supply the processors that power AI, have announced plans to invest $3bn and $1bn respectively. Meta said Nvidia, AMD and Broadcom together could buy up to $5bn of its stock.

Some observers see this as part of an increasingly circular flow of money in the AI industry: chip suppliers helping to finance the expansion of one of their biggest customers, which then spends the money on their chips.

What the money is for

Meta is building as many as four data centre "superclusters", each with more than one gigawatt of capacity, including its Hyperion campus in Louisiana. In total, the company has committed to about $825bn in future spending, driven mostly by data centres, AI infrastructure and cloud computing.

Investor nerves

The raise comes as investors grow uneasy about the cost of the AI race. Meta reported negative free cash flow in its latest quarter, S&P cut its credit outlook to negative, and its shares fell for a fifth straight week.

Selling shares rather than borrowing avoids adding debt, but it dilutes existing shareholders. The scale of the raise shows how expensive the race to build more powerful AI has become, even for one of the world's most profitable companies.

Sources and references

  1. 1.Meta increases size of planned equity offering to $97.5-billion — The Globe and Mail / Reuters
  2. 2.Meta increases equity offerings to $97.5 billion — The Manila Times
  3. 3.Key facts: META Plans ~$97.5B Share Sale; S&P Cuts Outlook — TradingView

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