Meta is creating a new class of non-voting stock to help fund its broad AI buildout while keeping its current voting structure intact, according to TechCrunch. During Wednesday's third-quarter earnings call, executives confirmed earlier reporting about the plan and shared details on strong revenue growth alongside heavy spending.
Key takeaways
- Meta plans to distribute a new class of non-voting capital stock to existing shareholders through a stock dividend.
- Chief financial officer Susan Li stated the shares will support capital raising, employee compensation, and acquisitions.
- The company reported $64 billion in revenue for the past quarter, which marks a 26% jump from a year earlier.
- CEO Mark Zuckerberg noted that more than 10 million people in the U.S. and Canada set up Muse personal agents in just a month and a half.
How will the new meta stock class fund AI?
TechCrunch reports that Meta plans to issue shares that do not give their owners a vote on company decisions. Susan Li explained that the company created this new class of shares to use for capital raising, employee compensation, acquisitions, and other general corporate purposes. This approach preserves the voting power of existing Class A and Class B shareholders and maintains the current founder-led structure.
The new shares will also expand the company's funding tools and give it flexibility to invest behind the momentum driven by AI across every part of the business. Meanwhile, the company reported strong earnings that beat Wall Street expectations. Revenue reached $64 billion, which is a 26% increase from a year earlier, though costs and expenses climbed by 68% year over year.
Reality Labs and AI product growth
Reality Labs, the division responsible for AR glasses and VR headsets and software, continues to lose money. Meta expects the division's losses to shrink from 2025 levels to between $18 billion and $19 billion. At the same time, the company's AI push is moving fast. Meta has released several AI models this year, including Muse Spark, Muse Glimmer, Muse Wonder, Muse Spark Open, and a coding agent named Muse Code.
Mark Zuckerberg stated during the call that Muse personal agents reached more than 10 million users in the U.S. and Canada in just a month and a half. The company also announced a new line of avatars for the Meta Muse assistant at its Meta Connect event. Zuckerberg noted that the product has clear product-market fit and the team is entering a phase focused on scaling it to eventually serve billions of people.
What happens next?
Meta must still navigate several hurdles as it scales its operations. Susan Li pointed out that ongoing legal and regulatory matters could significantly impact the business and financial results. The company continues to monitor scrutiny on youth-related issues in several markets, with a number of youth-related trials scheduled in the coming months in the United States.
Frequently asked questions
Meta is creating a new class of non-voting stock to help fund its broad AI buildout, support capital raising, handle employee compensation, and fund acquisitions while preserving the voting power of existing shareholders.
Meta chief financial officer Susan Li confirmed the reporting about the new stock class during the company's third-quarter earnings call on Wednesday.
Meta made $64 billion in revenue during the quarter, which is a 26% jump from a year earlier, beating Wall Street expectations.
Meta expects Reality Labs losses to shrink from its 2025 levels to between $18 billion and $19 billion.
According to CEO Mark Zuckerberg, more than 10 million people in the U.S. and Canada set up Muse personal agents in just a month and a half.
Based on reporting by TechCrunch. Read the original article
