Meta plans $35 billion stock offering backed by Nvidia, AMD and Broadcom

Meta, which owns Facebook and WhatsApp, intends to raise nearly $100 billion through various stock offerings in the coming months, according to MarketWatch. Most immediately, the social-media giant is planning an offering of $35 billion in common stock and preferred stock that will support its investments into artificial intelligence.

Nvidia, which makes computer chips for artificial intelligence, Advanced Micro Devices, which makes computer processors, and Broadcom, which designs semiconductor infrastructure, have expressed interest in purchasing up to $5 billion in aggregate through this offering. Meta also plans to launch an at-the-market program of up to $60 billion, which will be tied to the launch of its new Class C shares.

Mark Zuckerberg, who runs Meta, created that nonvoting class of stock to help the company raise money. The offering will go toward artificial intelligence infrastructure and personal superintelligence. William Blair, which is an investment banking firm, said the financing plan reflects the substantial capital needed to succeed in the artificial intelligence race.

Ryan Lee, a senior vice president of product and strategy at Direxion, which is an exchange-traded fund provider, said that the chip makers need major cloud-services providers like Meta to continue spending on chips. Bob Lang, who founded Explosive Options, took a view that the chip companies have a vested interest in making sure their biggest customers can raise the funds needed to continue buying their products without hitting the wall on spending.

Devon Coombs, a teaching professor of finance at Santa Clara University, said investors need to understand how much reported revenue represents independent customer demand versus spending supported by investments from companies participating in the same ecosystem.