Meta's $25 billion stock offering attracted about five times more demand than shares

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Meta priced the upsized Class A common stock sale at $625 a share as it raises equity to fund AI infrastructure spending

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Meta $META fielded orders worth roughly five times the stock being offered in its upsized $25 billion Class A common stock sale, according to Bloomberg.

Meta priced the offering at $625 per share, the company said. It raised the size of the sale to $25 billion from $22.5 billion. Meta stock slid by up to 1.4% in New York trading on Tuesday, reaching a low of $621.47.

Over half of the stock was placed with existing investors and long-only funds, while the 15 biggest buyers accounted for roughly 70% of it, according to Bloomberg. Demand for Meta's mandatory convertible preferred stock offering exceeded the amount on offer by a multiple, according to Bloomberg.

The common stock sale is tied to forward sale agreements with Morgan Stanley $MS Capital Services and Goldman Sachs $GS & Co. At a forward price of about $622.92 a share, Meta expects net proceeds of about $24.9 billion before expenses when the agreements settle, which it expects on or before Nov. 19, 2027. Meta does not expect to receive proceeds from the forward purchasers' sale of the stock in the offering, the company said.

Underwriters hold a 30-day option to buy up to $3.75 billion more Class A stock. The offering is expected to close on Oct. 29.

The second offering covers 250 million depositary shares at $50 each, representing interests in 6.50% Series A Mandatory Convertible Preferred Stock. Net proceeds are expected to be about $12.5 billion. That offering is also expected to close on Oct. 29, and Meta has applied to list the depositary shares on the Nasdaq $NDAQ Global Select Market under the symbol "METAM."

Meta said before pricing that Nvidia $NVDA, Advanced Micro Devices and Broadcom $AVGO had indicated interest in buying up to $5 billion of the Class A stock. The indications were not binding, and each company could buy more, fewer or none of the shares offered.

Meta launched the underwritten offerings on Monday, with about $22.5 billion in Class A common stock and about $12.5 billion in depositary shares. Nvidia later said in a statement that it would commit $3 billion to the offering as the two companies expand their partnership on Meta's Muse AI models and agents.

The offerings are part of a broader financing plan that includes an at-the-market program of up to $60 billion in Class C common stock. Meta said the program is not expected to begin until the first quarter of 2027, after the Class C stock begins trading. Meta expects $135 billion to $145 billion in capital expenditures in 2026.

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