Meta announces $95 billion stock offering to fund AI expansion

Meta said Monday it is planning to raise a total of $95 billion to support its investments in artificial intelligence infrastructure and superintelligence.

The stock was down 1.6% in morning trading after the announcement. Nvidia, Advanced Micro Devices and Broadcom were interested in purchasing up to $5 billion in shares, Meta said in a statement.

The tech giant will initially raise $35 billion in underwritten public equity offerings, before raising an additional $60 billion with an at-the-market program.

The news comes as hyperscalers pour record sums into the AI infrastructure build-out. Goldman Sachs estimates that AI-related capital spending could total about $7.6 trillion from 2026 through 2031, across compute, data centers and power.

Meta's planned investments will support "emerging AI opportunities" including its family of apps, its AI agent Muse and its data center business, the company said Monday.

It plans to balance funding for these investments through a mix of operating cash flow, investment-grade debt, partnerships and equity capital.

Meta racing to secure AI infrastructure

Meta is among the major hyperscalers that are increasingly tapping debt to fund the expensive infrastructure required for the AI boom.

Last week, Meta posted third-quarter results showing revenue jumped 26% year on year: $64.60 billion versus the $63.37 billion analysts expected. However, investors focused more on the tech company's negative free cash flow and its higher full-year capital expenditure forecast.

It now expects its full-year capex to range from $135 billion to $145 billion, raising the bottom of the range from $130 billion. That sent Meta's shares lower on Thursday. 

Meta is building four "superclusters" with more than 1 gigawatt of capacity each and is on track to nearly double total infrastructure capacity in 2026 on a year-over-year basis, the company said.

The decision to raise more money "reflects the eye-watering levels of investment required to keep up in the AI arms race," Ben Wood, senior partner at CCS Insight, told CNBC. 

"Meta offering more stock comes at a time when numerous companies, such as Google, SpaceX and soon, Anthropic, are going to the markets to raise funds."

Alphabet, Google's parent company, said it would look to raise $85 billion in June. SpaceX has closed a $40 billion debt financing to purchase graphics processing units. Anthropic is preparing for an initial public offering.

TikTok U.S. is looking to secure multiple gigawatts of computing capacity over the coming years, CNBC reported Friday.