Meta Raises $30 Billion in Largest Bond Sale Ever to Fund AI Infrastructure Expansion

Meta to raise $25bn from bond sale amid soaring AI costs

Meta is planning to raise $25bn from a bond sale to help it pay for soaring artificial intelligence costs, even as the Big Tech group's share price fell amid concerns that its spending is too high. The social media group has hired Citigroup and Morgan Stanley to raise up to $25bn in debt, ranging from five to 40 years in maturity, in what would be one of the biggest bond sales of the year, according to two people close to the matter. It comes a day after chief executive Mark Zuckerberg warned that the US tech group would spend even more aggressively as part of an arms race to build the data centres and infrastructure powering the AI boom. Meta's shares fell 12 per cent after Wall Street's opening bell on Thursday -- wiping out about almost $240bn from its valuation -- as investors fretted over the tech group's huge outlay. The sale underscores how technology giants are increasingly turning to the debt markets as they spend record sums to build AI infrastructure. Meta raised $27bn of private debt from credit providers, including Pimco and Apollo, in recent months to fund construction of its huge "Hyperion" data centre in Louisiana. Oracle sold $18bn of bonds in September. Large tech companies are projected to invest $400bn on AI infrastructure this year, including buying computer chips and building data centres. On Wednesday, Meta, Microsoft and Google's parent Alphabet all disclosed larger than expected spending plans in the current quarter. The social media company said capex could hit $72bn by the end of the year and that spending growth would be "notably larger" in 2026, implying a number far in excess of an earlier forecast for $105bn. Zuckerberg defended huge spending on infrastructure for Meta's own use. He told analysts on Wednesday that it was "the right strategy to aggressively frontload building capacity" as part of the tech group's bid to be the first to build artificial superintelligence. At a recent dinner with US President Donald Trump, Zuckerberg said the company planned to spend $600bn on US data centres and AI infrastructure through 2028. Meta, Citigroup and Morgan Stanley declined to comment. The bond sale was first reported by Bloomberg.

Meta to raise $30 billion in its biggest bond sale as AI expansion costs rack up

Social media giant Meta Platforms is raising a massive $30 billion through its largest-ever bond sale. This significant funding aims to support Meta's extensive investments in artificial intelligence infrastructure. The company anticipates higher capital expenditures next year due to these AI ambitions. Major tech firms are collectively spending billions on AI development. Social media giant Meta Platforms will raise up to $30 billion in its biggest bond offering ever, it said in a filing on Thursday, as Big Tech rushes to fund the costly expansion of artificial intelligence infrastructure. Meta, navigating a period of intense investments in AI that is creating significant cost pressures, has flagged that its capital expenditure next year would be "notably larger" than in 2025. The company's shares closed down more than 11% on Thursday, as investors mulled a 32% increase in costs outpacing a 26% revenue jump. It is raising the funds through a six-part bond sale with maturities ranging from five to 40 years. Meta last tapped the bond market in 2022 with a $10 billion sale. The principal amounts for the bonds range from $4 billion to $6.5 billion and co-managers for the sale include Morgan Stanley, Allen & Company and Blaylock Van, among others. Last week, Meta struck a $27 billion financing deal with Blue Owl Capital, Meta's largest-ever private capital agreement, to fund its biggest data center project in Richland Parish, Louisiana, known as "Hyperion." Major tech companies, including Alphabet, Amazon.com, Meta, Microsoft and CoreWeave , are on track to spend $400 billion on AI infrastructure this year, Morgan Stanley estimates. Meta is also investing heavily to attract and retain top AI researchers and engineers as a talent war between tech firms intensifies. For the company's new and ambitious AI goals, CEO Mark Zuckerberg personally led an aggressive talent hiring spree for its recently reorganized AI unit: Superintelligence Labs. Employee compensation costs will be the second-largest contributor to the increase in costs next year, particularly AI talent, Meta CFO Susan Li said. Meta has also boosted the lower end of its capital expenditure outlook to between $70 billion and $72 billion this year, compared with its prior forecast of $66 billion to $72 billion. Fixed-income news service IFR and Bloomberg first reported details of the bond sale earlier on Thursday. Reports of the Meta bond sale had spurred selling of U.S. Treasuries for hedging purposes. Investors have flocked to large new corporate bond issues amid wider uncertainty in equity markets.

Meta Platforms plans to sell $25 billion in bonds for AI infrastructure By Investing.com

Investing.com -- Meta Platforms Inc (NASDAQ:META) is planning to sell at least $25 billion of investment-grade bonds on Thursday, as the tech giant seeks funds for artificial intelligence infrastructure investments. The company aims to issue notes in up to six different segments with maturities ranging from five to 40 years, according to a report from Bloomberg News, citing people familiar with the matter who were not authorized to speak publicly. Initial pricing discussions for the 40-year bond indicate a yield of approximately 1.4 percentage points above benchmark Treasury rates, one of the sources said. The proceeds from the bond sale will be directed toward general corporate purposes, as Meta joins other technology companies in raising capital to support heavy investments in AI infrastructure. This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.

Meta to raise $30 billion in its biggest bond sale as AI expansion costs rack up

(Reuters) -Social media giant Meta Platforms will raise up to $30 billion in its biggest bond offering ever, it said in a filing on Thursday, as Big Tech rushes to fund the costly expansion of artificial intelligence infrastructure. Meta, navigating a period of intense investments in AI that is creating significant cost pressures, has flagged that its capital expenditure next year would be "notably larger" than in 2025. The company's shares closed down more than 11% on Thursday, as investors mulled a 32% increase in costs outpacing a 26% revenue jump. It is raising the funds through a six-part bond sale with maturities ranging from five to 40 years. Meta last tapped the bond market in 2022 with a $10 billion sale. The principal amounts for the bonds range from $4 billion to $6.5 billion and co-managers for the sale include Morgan Stanley, Allen & Company and Blaylock Van, among others. HEFTY INVESTMENT IN AI EXPANSION Last week, Meta struck a $27 billion financing deal with Blue Owl Capital, Meta's largest-ever private capital agreement, to fund its biggest data center project in Richland Parish, Louisiana, known as "Hyperion." Major tech companies, including Alphabet, Amazon.com, Meta, Microsoft and CoreWeave, are on track to spend $400 billion on AI infrastructure this year, Morgan Stanley estimates. Meta is also investing heavily to attract and retain top AI researchers and engineers as a talent war between tech firms intensifies. For the company's new and ambitious AI goals, CEO Mark Zuckerberg personally led an aggressive talent hiring spree for its recently reorganized AI unit: Superintelligence Labs. Employee compensation costs will be the second-largest contributor to the increase in costs next year, particularly AI talent, Meta CFO Susan Li said. Meta has also boosted the lower end of its capital expenditure outlook to between $70 billion and $72 billion this year, compared with its prior forecast of $66 billion to $72 billion. Fixed-income news service IFR and Bloomberg first reported details of the bond sale earlier on Thursday. Reports of the Meta bond sale had spurred selling of U.S. Treasuries for hedging purposes. Investors have flocked to large new corporate bond issues amid wider uncertainty in equity markets. (Reporting by Dagmarah Mackos, Anna Peverieri and Kanjyik Ghosh in Barcelona, and Jaspreet Singh and Arsheeya Bajwa in Bengaluru; Editing by Tomasz Janowski, Jan Harvey, Jane Merriman and Alan Barona)