Meta (META) stock fell more than 6% in late-afternoon trading on Friday following a report by the Financial Times that the company is considering a fresh equity sale to pay for its massive AI build-out.
The move would follow a similar one by Google parent Alphabet (GOOG, GOOGL), which initially planned to sell $80 billion in stock, but increased the amount to $85 billion due to intense investor demand.
Meta, like Amazon (AMZN), Google, and Microsoft (MSFT), is spending billions of dollars on AI chips and data centers. The four companies are expected to spend more than $720 billion in 2026 alone, with plans to increase that amount in 2027.
Meta CEO Mark Zuckerberg has been working to right the company’s AI ship over the last year after the disappointing release of its Llama 4 model. Meta was scheduled to debut a larger Llama 4 Behemoth AI model, but ultimately held it back.
To address the matter, Zuckerberg has spent lavishly on AI talent, including a $14 billion “aquihire” of Scale AI and its CEO Alexandr Wang, who now serves as Meta’s chief AI officer.
And it looks as though the effort has begun to pay off. Meta debuted its Muse Spark model in April, saying it was the first of the Muse family of models.
But according to the Wall Street Journal, Meta has delayed releasing what’s called an application programming interface (API) for the model that would allow developers to connect Muse Spark to their own programs and apps.
The company has also begun exploring and adding new ways to generate revenue to help offset its staggering spending.
The company is testing subscription programs called Instagram, WhatsApp, Facebook, and Meta AI under the Meta One umbrella, which include increased AI usage rates and messaging enhancements.
Zuckerberg has also teased the idea of launching a Meta cloud computing platform.
