Meta Issues New Non-Voting Shares to Fund AI Ambitions

Meta is changing how it raises money to power its AI future.

The company announced a plan to issue a new class of non-voting stock. This move will help fund its aggressive push into artificial intelligence. The news broke during the company's third-quarter earnings report on Wednesday. Semafor first reported the potential issuance of these specific shares. Meta confirmed the details on its earnings call.

Susan Li, Meta's chief financial officer, explained the mechanics of the plan. The company will create a new class of non-voting capital stock. Existing shareholders will receive these shares through a stock dividend. Li stated that the new shares are designed for capital raising and employee compensation. They will also support acquisitions and other corporate goals. Crucially, this structure preserves the voting power of current Class A and B shareholders.

Li emphasized that this move maintains Meta's founder-led structure. It also expands the company's funding tools. This gives Meta flexibility to invest heavily. The company is seeing unprecedented momentum in its business, driven largely by AI. This new stock class allows Meta to keep investing without diluting the control of its existing leaders.

Meta reported strong financial results for the past quarter. Revenue reached $64 billion, a 26% increase from the previous year. However, costs and expenses also climbed significantly. They rose by 68% year-over-year. This spending reflects the company's heavy investment in new technologies and infrastructure.

Reality Labs, the division behind AR glasses and VR headsets, continues to operate at a loss. However, the losses are shrinking compared to previous periods. The company expects this division's losses to narrow from 2025 levels. It projects the loss to fall between $18 billion and $19 billion. This indicates a gradual path toward profitability for its hardware and software arm.

Over the past year, Meta has released several AI models. These include Muse Spark and Muse Glimmer earlier this year. In recent weeks, it added Muse Wonder and Muse Spark Open. The latter is an open-weight model with publicly available parameters. Meta also launched Muse Code, a coding agent for software developers. At its Connect event, the company introduced cute avatars for its AI assistant, Meta Muse, to make the service more relatable.

CEO Mark Zuckerberg highlighted the success of these AI products. He noted that over 10 million people in the U.S. and Canada set up Muse personal agents in just six weeks. He claimed the product has been number one in the App Store almost every day. Zuckerberg said the company is now entering an operational phase focused on scaling. He expects the product to eventually serve billions of people.

Despite the growth, challenges remain. Li noted that legal and regulatory issues could impact the business. The company is monitoring active matters closely. Scrutiny continues on youth-related issues in several markets. Multiple trials regarding these issues are scheduled in the coming months in the United States.