Meta to raise up to $95 billion in equity to fund costly AI expansion

Meta has stepped up spending on data centres, computing capacity and ​AI products to compete with rival AI heavyweights OpenAI and Anthropic. The social media ​company had cash, cash equivalents and marketable securities of $82.45 billion, slightly exceeding its long-term debt of $80.92 billion as of September 30, ​from last week.

Read:Wall St week ahead earnings flood, Fed meeting will test rickety AI market rally. The company has committed to spend about $825 billion in ​the future, primarily driven by its growing investments in data centres, AI-related infrastructure ‌and ⁠cloud computing power.

Meta said chip companies Nvidia, Advanced Micro Devices and Broadcom have expressed interest in purchasing up to $5 billion of Meta's Class A common stock in the offering.

Last week, Meta raised ​the lower end ​of its annual ⁠spending forecast, now expecting capital expenditure to be between $135 billion and $145 billion this year, up from $130 billion ​to $145 billion expected previously.

Meta reported a $2.12 billion cash burn ​in ⁠the third quarter, marking its first negative free cash flow in over ten years, compared with a positive cash flow of $10.63 billion a ⁠year ​ago. The company reported third-quarter revenue of $64.60 billion, ​ahead of Wall Street estimates of $63.37 billion.

It also projected fourth-quarter revenue between $73 billion ​and $76 billion.