Meta Expands AI Fundraising Plan to $97.5 Billion as Nvidia Commits $3 Billion

Meta Platforms has expanded its planned equity fundraising to as much as $97.5 billion to support its rapidly growing artificial intelligence operations, while chipmaker Nvidia has committed $3 billion to the offering as the two companies strengthen their technology partnership.

The revised financing terms, reported by Reuters on Tuesday, October 27, follow Meta's announcement a day earlier of a plan to raise up to $95 billion through a combination of public share offerings and a future stock-sale programme.

Meta increased the size of its Class A common stock offering from $22.5 billion to $25 billion, pricing the shares at $625 each.

The company also priced 250 million depositary shares representing mandatory convertible preferred stock at $50 per share, bringing the combined value of the two public offerings to approximately $37.5 billion.

A separate programme could allow Meta to raise another $60 billion by selling newly created non-voting Class C shares after they begin trading, which is expected in early 2027.

That additional programme has not been finalised, and the company has not raised the entire $97.5 billion.

The fundraising represents one of the largest equity financing initiatives announced by a major technology company as competition intensifies over the infrastructure needed to develop and operate advanced AI systems.

Nvidia, Advanced Micro Devices and Broadcom had initially expressed interest in purchasing up to $5 billion of Meta shares collectively.

Nvidia has since announced a $3 billion investment, alongside plans to expand its collaboration with Meta on AI computing systems and the company's Muse AI platform.

The involvement of major chip suppliers has attracted attention because those companies also stand to benefit from Meta's substantial purchases of processors and other computing equipment.

Analysts have raised questions about the increasingly interconnected financial relationships among AI developers, infrastructure providers and semiconductor manufacturers.

Meta's expansion is placing growing demands on its finances.

The company expects capital expenditure of between $135 billion and $145 billion in 2026, driven by investment in data centres, computing capacity and AI products.

It reported negative free cash flow of approximately $2.12 billion in the third quarter, compared with positive free cash flow of more than $10 billion during the same period a year earlier.

Despite the spending pressures, Meta maintains that its AI investments are already improving advertising performance, user engagement and opportunities for new products.

The company says its Muse AI service attracted more than 10 million users in the United States and Canada during its early weeks.

Meta also reported third-quarter revenue of approximately $64.6 billion, an increase of 26% from a year earlier.

The planned non-voting Class C shares are intended to provide additional financing flexibility while preserving the voting control of founder and chief executive Mark Zuckerberg.

However, issuing new shares can dilute existing shareholders' economic interests, and the eventual amount raised will depend on the completion and terms of the offerings.

The announcement comes during an unusually expensive period for the global AI industry, with major technology companies committing substantial resources to data centres, electricity supply, advanced processors and computing networks.

For Meta, the immediate challenge is to convert those investments into sustainable financial returns while maintaining investor confidence.

The revised fundraising plan signals the scale of the company's ambitions, but its full financial impact will become clearer only as the offerings proceed and the proposed future share programme takes shape.