Meta is seeking to raise between $20 billion and $25 billion in a bond sale on Tuesday to fund AI spending. The offering follows an outlook cut from S&P Global Ratings and a quarter of negative free cash flow.
Meta is seeking to raise between $20 billion and $25 billion in a bond sale on Tuesday as it ramps up spending on AI infrastructure, models and services. Meta declined to comment.
Deal split between dollars and euros
People familiar with the matter said the debt sale is expected to be two-thirds in U.S. dollars and one-third in euros. They asked not to be named because the details are private. Final pricing should come Tuesday afternoon, according to the sources.
Bloomberg News first reported Meta's plans. The sale arrives after Meta previously raised $25 billion in an April bond sale.
Rating outlook turns negative
The sale comes days after S&P Global Ratings revised Meta's outlook from AA- stable to AA- negative. S&P cited "uncertainty" about the company's capex spending and negative free cash flow.
In its third-quarter earnings report, Meta said its full-year capex will come in between $135 billion to $145 billion, a $5 billion increase to the low end of its previous guidance. The company also posted negative free cash flow of $2.12 billion for the quarter, joining Alphabet and Amazon in reporting a negative figure.
Funding plans reach $95 billion
Last week, Meta said it plans to raise $95 billion to fund its AI initiatives. It intends to first raise $35 billion in underwritten public equity offerings, then an additional $60 billion through an at-the-market program.
Meta's stock rose 2.7% on Tuesday. It had dropped in 12 of the prior 14 trading sessions and closed out October with its worst month in four years.
Source: CNBC
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