Meta used its third-quarter earnings release on October 21, 2026 to announce that its board has approved a new class of non-voting common stock — Class C shares — built to help fund its enormous AI spending. CFO Susan Li put it plainly on the earnings call: the shares can be used for capital raising, employee compensation and acquisitions, while preserving the voting power of existing Class A and B shareholders.
How the shares will be issued, and when they trade
Meta will distribute the Class C shares as a stock dividend, one for every Class A or B share held, an arrangement with the economic effect of a two-for-one split. Trading on Nasdaq is expected to begin on January 19, 2027. Because the new shares carry no votes, fresh money raised through them will not dilute the voting control of Mark Zuckerberg and the founders. The approach mirrors Alphabet's 2014 move; Alphabet also issued a large batch of new shares this year to finance AI, half of them non-voting.
Why add a financing valve right now
The earnings numbers explain the timing. Meta's third-quarter revenue reached $64.6 billion, up 26% year over year, but full-year capital expenditure guidance was narrowed to $135 billion to $145 billion, third-quarter capex alone hit $34.9 billion, and quarterly free cash flow swung to negative $2.12 billion. Add a $9.89 billion settlement charge with state attorneys general, and operating income fell 37% to $13 billion. Advertising still makes the money, and the company credited AI recommendations with lifting ad revenue, but spending has outrun the comfort zone of operating cash flow. The Class C structure is therefore a pre-installed valve: when data centers, chips or acquisitions need paying for, Meta can issue shares without surrendering any control. Whether and when it turns that valve is a question for the 2027 rollout.
