Meta plans to raise up to $25 billion through bonds for AI — CNBC

Meta plans to raise between $20 billion and $25 billion on Tuesday through a bond offering to finance artificial intelligence infrastructure, AI models and services. CNBC reports.

Offering parameters

According to CNBC sources familiar with the company’s plans, about two-thirds of the debt securities are expected to be denominated in U.S. dollars, while the remaining third will be in euros. The sources asked not to be named because the deal details are not public. The final bond pricing was expected to be determined Tuesday afternoon.

Meta declined to comment. Bloomberg News was first to report on the company’s plans. In April, Meta already raised $25 billion through a bond sale.

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AI spending

Last week, Meta also announced plans to raise $95 billion to finance AI initiatives. Of this amount, the company initially intends to obtain $35 billion through underwritten public stock offerings and another $60 billion through an at-the-market stock sale program.

In its third-quarter report released last month, Facebook’s parent company said its annual capital expenditures would total between $135 billion and $145 billion. The lower end of the previous forecast was raised by $5 billion. Over the last quarter, Meta recorded negative free cash flow of $2.12 billion.

On Friday, S&P Global Ratings changed Meta’s rating outlook from AA- stable to AA- negative, citing uncertainty due to substantial capital expenditures and negative free cash flow. Meta shares rose 2.7% on Tuesday after falling in 12 of the previous 14 trading sessions. October was the company’s shares’ worst month in four years.