Meta weighs big equity raising to finance AI infrastructure, FT reports
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People walk behind a logo of Meta Platforms company, during a conference in Mumbai, India, September 20, 2023. REUTERS/Francis Mascarenhas
June 5 (Reuters) - Meta is considering raising tens of billions of dollars in a stock offering as it seeks new sources of capital to fund the company's AI ambitions, the Financial Times reported on Friday.
The report comes after Alphabet moved to raise $84.75 billion in upsized equity offerings, as Big Tech competes to build data centers and capitalize on growing demand for AI.
Meta executives have been exploring "creative" ways to raise cash as it prepares to sharply boost its AI-related expenses, the FT report said, citing three people familiar with the plans.
After the success of Alphabet's equity raising this week, the discussions have intensified, as per the report.
Meta did not immediately respond to Reuters' request for comment. Shares of the social media company were down 6.6% following the report.
The world's largest tech companies are increasingly turning to debt and equity markets to fund AI infrastructure investments, marking a shift from their longstanding practice of funding investments largely with cash.
Meta in October filed for its largest bond offering ever of up to $30 billion and also struck a $27 billion financing deal with Blue Owl Capital .
In April, the Facebook and Instagram parent raised its annual capital spending forecast to between $125 billion and $145 billion.
The company has not yet hired banks and ultimately may not issue new stock, according to the FT report, which added that it was "premature" to say that the company had decided what to do and all financing options remain on the table.
(Reporting by Harshita Mary Varghese in Bengaluru; Editing by Shilpi Majumdar)
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