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[BUSINESS] · United States · 76 sources

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Meta approves new non-voting stock to fund AI expansion

Meta has announced plans to issue a new class of non-voting Class C shares, a strategic move designed to fund its aggressive expansion into artificial intelligence and facilitate acquisitions without diluting the voting control of founder Mark Zuckerberg. The new shares are expected to be distributed starting January 19, 2027, in a manner functionally similar to a two-for-one stock split, where shareholders receive one Class C share for every Class A or B share held.

During its third-quarter earnings report, Meta disclosed a 26% increase in revenue, reaching $64.6 billion. However, operating costs rose by 68% due to heavy investments in AI infrastructure. The company also faces significant market volatility; following the earnings report, Meta's stock experienced a sharp decline as investors reacted to increased capital expenditure projections and negative free cash flow.

Beyond AI funding, reports suggest the new share structure may also assist Zuckerberg in managing potential tax liabilities from California’s proposed Proposition 40, a wealth tax on billionaires. Zuckerberg currently maintains approximately 60.6% of Meta’s voting power.

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