Meta Issues Non-Voting Stock For AI
The tech giant confirmed plans to launch a new share class to finance its massive artificial intelligence expansion.
By Mariana Delgado ·
Meta has confirmed it will create a new class of non-voting stock to help finance its aggressive expansion into artificial intelligence. The announcement came during the company's third-quarter earnings call on Wednesday, validating earlier reports that the social media giant is looking for new ways to fund its AI infrastructure.
Susan Li, the company's chief financial officer, detailed the strategy during the call. She explained that the new non-voting capital stock will be distributed to existing shareholders as a stock dividend. This move allows Meta to issue shares for capital raising, employee compensation, and acquisitions without diluting the voting power of current Class A and B shareholders.
Li stated that the primary goal is to preserve the company's founder-led structure while expanding its funding tools. This flexibility is intended to support the unprecedented momentum Meta claims to be seeing across its business, which is currently driven by AI developments.
The financial results for the quarter were strong, with the company beating Wall Street expectations. Meta reported revenue of $64 billion, representing a 26% increase from the same period last year. However, costs and expenses rose significantly, jumping 68% year-over-year.
The Reality Labs division, which handles augmented reality glasses and virtual reality headsets, continues to operate at a loss. Nevertheless, the company expects these losses to shrink from 2025 levels to a range of $18 billion to $19 billion.
Meta has accelerated its AI product releases over the past year. The company recently launched Muse Spark and Muse Glimmer, followed by Muse Wonder and Muse Spark Open, an open-weight model. It also introduced Muse Code, a coding agent for developers, and announced new avatar options for its AI assistant at its Meta Connect event.
CEO Mark Zuckerberg reported that these products are gaining traction. He noted that more than 10 million people in the U.S. and Canada have set up Muse personal agents in just a month and a half. Zuckerberg said the product has achieved clear product-market fit and is now entering a scaling phase with the goal of eventually serving billions of users.
Despite the growth, Li warned of lingering regulatory and legal challenges. The company is monitoring active matters that could impact its financial results, including increased scrutiny on youth-related issues. Several trials concerning these issues are scheduled in the United States in the coming months.
Source: TechCrunch
