Meta plans new non-voting share class to fund its AI expansion
US tech company Meta said it will create a new class of non-voting stock and distribute it to existing shareholders as a stock dividend. The shares are meant for capital raising, employee pay and acquisitions while preserving founder control.
Meta, the social media and technology company, confirmed on Wednesday that it plans to create a new class of non-voting stock. Such shares give their holders no vote on company decisions. The move is meant to help fund Meta's push into artificial intelligence. Semafor first reported the possibility, and company executives confirmed it during the earnings call for the third quarter.
What the plan involves
Chief financial officer Susan Li said the new class will be distributed to all current shareholders as a stock dividend. According to her, the publicly traded non-voting shares can be used for capital raising, employee compensation, acquisitions and other general corporate purposes. Voting power of existing Class A and Class B shareholders will remain intact. Li said this preserves Meta's founder-led structure and widens its funding tools.
Quarterly results
Revenue for the quarter reached $64 billion, up 26% from a year earlier, beating Wall Street expectations. Costs and expenses rose 68% year over year. Reality Labs, the division responsible for augmented reality glasses, virtual reality headsets and VR software, still loses money, though less than before. Meta expects its losses there to shrink from 2025 levels to between $18 billion and $19 billion.
AI products
Over the past year Meta has released several AI models, including Muse Spark and Muse Glimmer, and in recent weeks Muse Wonder and Muse Spark Open, an open-weight model. It also launched Muse Code, a coding agent for developers. CEO Mark Zuckerberg said more than 10 million people in the US and Canada set up Muse personal agents within a month and a half, and that the app has been number one in the App Store almost every day.
Legal risks
Li cautioned that the company is monitoring legal and regulatory matters that could significantly affect its business. Scrutiny of youth-related issues continues in several markets, and a number of youth-related trials are scheduled in the United States in the coming months.
