Meta plans to divide the bond offering into two-thirds U.S. dollars and one-third euros, with final pricing expected Tuesday afternoon. The borrowing spree follows an earlier $25 billion issuance completed in April and accompanies broader plans to raise $95 billion via equity offerings. Meanwhile, management boosted the bottom end of its annual capital expenditure guidance to a range of $135 billion to $145 billion. Despite recent pressure, company shares rose 2.7% on Tuesday to stem an extended multi-session slide.
Key points
Accelerating artificial intelligence infrastructure demands are forcing Meta to rely heav…: Accelerating artificial intelligence infrastructure demands are forcing Meta to rely heavily on multibillion-dollar debt offerings.
Escalating capital expenditure forecasts are creating cash flow deficits and increasing c…: Escalating capital expenditure forecasts are creating cash flow deficits and increasing credit scrutiny from major rating agencies.
Tuesday's share price gain provided temporary relief following Meta's worst monthly stock…: Tuesday's share price gain provided temporary relief following Meta's worst monthly stock performance recorded in four years.
Sources checked by our analysis pipeline: 1
Meta is seeking to raise between $20 billion and $25 billion in a bond sale on Tuesday as the company ramps up its spending on artificial intelligence infrastructure along with AI models and services.
The debt sale is expected to be two-thirds in U.S. dollars and one-third in euros, according to people familiar with the matter who asked not to be named because the details are private. Final pricing for the bond sale should come Tuesday afternoon, the sources said.
Meta declined to comment. Bloomberg News first reported on Meta's plans.
Meta's bond sale comes days after S&P Global Ratings revised the company's outlook from AA- stable to AA- negative, citing "uncertainty" about its hefty capex spending and negative free cash flow.
In its third-quarter earnings report last month, the Facebook parent revealed that its full-year capex will come in between $135 billion to $145 billion, representing a $5 billion increase to the low end of its previous guidance. Meta posted negative free cash flow of $2.12 billion for its latest quarter, joining Alphabet and Amazon in reporting a negative…
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