Meta to issue non-voting shares to fund AI — Channel NewsAsia

On October 21, Meta announced that it would introduce a new class of non-voting shares and raised the lower end of its capital expenditure forecast for the current year. As Channel NewsAsia reports, the company expects its capital expenditures to total between $135 billion and $145 billion, compared with its previous forecast of $130 billion to $145 billion.

Funding artificial intelligence development

Meta is investing substantial funds in chips and data centers to compete more actively with OpenAI and Anthropic in artificial intelligence. The new non-voting shares could allow the company to finance acquisitions and recruit specialists without weakening CEO Mark Zuckerberg's control over shareholder voting.

The company also reported quarterly revenue of $64.6 billion, exceeding Wall Street analysts' forecast of $63.37 billion, according to LSEG. Meta also projected fourth-quarter revenue above market expectations.

The report notes that the popularity of the consumer-focused AI agent Muse and the release of a new series of models helped Meta justify its investments to investors. At the same time, some companies are restricting access to this agent over security concerns.

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Legal and regulatory cases

At the same time, Meta is facing legal claims. A judge in New Mexico ordered the company to pay a $25 billion fine following a jury decision that found Meta had misled state residents about sharing user data with third parties and applying policies against hate speech and disinformation in a case connected to the British consulting firm Cambridge Analytica.

In August, Meta also agreed to pay up to $18 billion over ten years and limit teenagers' use of Facebook and Instagram to settle claims brought by nearly all U.S. states. The plaintiffs argued that Meta's platforms were designed to make children addicted.

Advertising remains Meta's main source of revenue. Its short-video service Reels competes with TikTok and YouTube Shorts, while Threads competes with Elon Musk's X platform. The company uses artificial intelligence for more precise ad targeting and user recommendations.