Meta closes $15 billion bond sale, expands stock offering

Meta Platforms ↗ 2.05% completed a $15 billion five-part senior-note offering on Thursday, November 5, and its underwriters fully exercised their option on a concurrent stock sale. That lifts the company's expected forward equity proceeds to about $28.7 billion as it pays for its AI buildout, Yahoo Finance reported.finance.yahoo.com

The deal follows days of heavy fundraising. Meta is mixing debt and equity to cover 2026 capital spending it expects to reach $135 billion to $145 billion. That spending has pushed free cash flow below zero.

Terms of the notes

The notes mature between 2031 and 2056, with coupons from 5.85% to 7.50%, according to Investing.com's summary of the company's SEC filing. The largest tranche is $4 billion of 2036 notes at 6.55%. Spreads range from 110 basis points over Treasurys on the 2031 notes to 220 basis points on the 2056 notes. Citigroup ↗ 1.27% and Morgan Stanley ↗ 0.31% led the underwriting.investing.com+1

Investors placed as much as $58 billion of orders, about 3.9 times the deal size, Bloomberg reported. Borrowing has become more expensive, though. The new 30-year coupon of 7.50% is about 190 basis points above the 5.625% coupon on the 2055 notes Meta sold in November 2025. Moody's ↘ 1.55% rated the debt Aa3 and said it expects Meta to keep "conservative financial policies" and a positive net cash position. The next day, Meta sold €9 billion of bonds in its first-ever euro offering, which drew record order books.finance.yahoo.com+3

Forward equity sale grows

Underwriters bought 6 million more Class A shares, bringing the forward sale to 46 million shares. Morgan Stanley and Goldman Sachs The Goldman Sachs Group, Inc. ↗ 0.53% are acting as forward purchasers. The shares were priced at $625, with an initial forward price of about $622.92. Meta gets the cash only when it delivers shares, on dates it chooses up to November 19, 2027.finance.yahoo.com+1

The stock sale is part of an equity plan that could total $97.5 billion, according to Reuters. The plan also includes a 6.50% mandatory convertible preferred and a proposed Class C at-the-market program of about $60 billion, which is not expected to start before the first quarter of 2027.reuters.com

Strain on the balance sheet

In the third quarter, Meta's capital spending was $34.91 billion against $32.79 billion of operating cash flow. Long-term debt reached $80.92 billion on September 30, before the new bonds, up from $58.74 billion at the end of 2025. Wells Fargo ↘ 0.73% estimated that Meta needs $60 billion to $80 billion in financing over the next 12 months.finance.yahoo.com

The debt load helps explain the heavy reliance on stock. A Meta special committee concluded that debt "of the magnitude that Company management was considering could have an adverse effect on the Company's credit ratings."