Meta plans to raise 95 billion dollars: AI investment continues to grow as Goldman Sachs maintains its 885-dollar price target

The 95 billion-dollar financing: what starts first, and what must wait?

On 26 October, Meta announced an equity financing plan of approximately 95 billion dollars, comprising an underwritten offering of 35 billion dollars and an at-the-market offering program of 60 billion dollars. The two components start at different times and cannot be combined as cash received in the current period.
The 35 billion-dollar component starting first includes 22.5 billion dollars of Class A common stock arranged in conjunction with forward sale agreements, and 12.5 billion dollars of mandatory convertible preferred stock. Nvidia, AMD and Broadcom each expressed interest in subscribing, with a combined purchase of up to 5 billion dollars of common stock, as part of the common stock offering described above.
The separate 60 billion-dollar program will begin only after non-voting Class C shares start trading. The company expects to implement it no earlier than the first quarter of 2027; final agreements, timing, size and terms have yet to be determined. The Class C share arrangement also serves to preserve the founder’s voting control in scenarios including years of investment.

The funding need comes from expanding AI investment. Goldman Sachs forecasts Meta’s capital expenditure at approximately 230 billion and 250 billion dollars in 2027 and 2028, respectively, totaling 480 billion dollars over the two years; GAAP total expenses over the same period are forecast at approximately 221 billion and 254 billion dollars, respectively.
Capital expenditure relates to infrastructure construction, while expenses reflect operating and accounting costs; they are not the same measure of spending. The 95 billion-dollar financing plan provides a new source of equity funding, but the two budgets cannot simply be added together to calculate a funding gap.
Investment pressure is also reflected in earnings forecasts: Goldman Sachs expects revenue to grow 28.0% and 22.8% in 2026 and 2027, respectively, while EBIT margin falls from 41.4% in 2025 to 31.2% and 29.9%, respectively. Business growth and margin pressure will coexist; if large long-term projects deliver returns more slowly, margin pressure could also last longer.

Goldman Sachs characterized third-quarter results as clearly exceeding its expectations, with positive core-business momentum, and highlighted Muse’s early results. The company also outlined new AI revenue opportunities involving small and medium-sized businesses and enterprise customers, among others; continued infrastructure expansion supports those opportunities.
Goldman Sachs’s long-term thesis covers the existing family of apps, new standalone apps, and hardware, software and platform opportunities at Reality Labs: AI and spatial computing could create sources of growth across multiple product entry points. The key constraint is monetization: whether AI, messaging services, social shopping and Reality Labs can be converted into revenue directly affects returns on large-scale investment.

Goldman Sachs maintained its Buy rating and 12-month price target of 885 dollars, without changing its future performance forecasts this time. Using the share price of 634 dollars cited in the article, the price less cash corresponds to approximately 20 times and 17 times its GAAP earnings-per-share forecasts for 2027 and 2028, respectively.
These valuation multiples have not been adjusted for the announced financing or other potential fundraising, so neither the new funds nor the changes in equity capital arising from the financing are included in this valuation comparison. The 885-dollar price target retains a framework that weights earnings valuation and adjusted discounted cash flow equally; maintaining the target does not mean a post-financing reassessment of per-share value has been completed.