Meta unveiled plans on Wednesday to establish a new class of nonvoting stock to bankroll its aggressive artificial intelligence push, pairing the corporate overhaul with a 26 percent surge in third-quarter revenue.
The company generated $64.6 billion in quarterly revenue, up from $51.2 billion in the same period last year and ahead of the $63.4 billion expected by analysts polled by LSEG Data & Analytics, Variety reported. Advertising sales accounted for $63.1 billion of that total, bolstered by a 10 percent gain in ad impressions and a 14 percent rise in average ad prices, according to the New York Post.
Net income rose to $9.86 billion, or $3.83 per diluted share, compared to $2.71 billion, or $1.05 per share, during the third quarter of 2025. Despite the growth, per-share earnings missed the $5.46 consensus forecast because of a $9.89 billion charge tied to an August agreement with 52 state attorneys general addressing youth mental health on social media. Meta stated that without the charge, operating profit would have reached $22.88 billion rather than falling 37 percent to $12.99 billion.
Hours before the financial report, a New Mexico state judge also ordered Meta to pay $25 billion after a jury found it liable for misleading the public about data privacy and content moderation rules, Variety reported.
A New Equity Structure for AI Spending
To fund its escalating technology requirements, Meta’s board authorized the creation of publicly traded, nonvoting Class C common stock, scheduled to become effective Jan. 19, 2027. Existing investors will receive one Class C share for each Class A or Class B share held, functioning similarly to a two-for-one stock split without diluting existing voting power, the New York Post reported.
A special board committee concluded the structure protects the founder-led leadership model under Chief Executive Mark Zuckerberg, Business Insider reported. Chief Financial Officer Susan Li said during the company’s earnings call that the shares will expand financing options and give Meta agility to back expanding operational momentum, according to The Verge.
“The scale of investment required to compete, sustain growth, expand infrastructure, and pursue new strategic initiatives amidst the AI transformation taking place in the industry is significant,” Meta said in a press release.
Soaring Infrastructure Costs and Product Launches
Meta spent $34.91 billion on capital expenditures during the third quarter alone, contributing to negative quarterly free cash flow of $2.12 billion. The company narrowed its full-year capital expenditure forecast to between $135 billion and $145 billion, raising the lower bound from a prior $130 billion estimate, according to the New York Post. The firm is also shifting capital away from its Reality Labs division to prioritize AI initiatives.
The spending surge coincides with the rollout of Meta’s artificial intelligence assistant, Muse, which debuted in September and reached 10 million downloads in the U.S. and Canada, along with the newly released Muse Wonder frontier model. Zuckerberg noted that about a quarter of users who set up the assistant now interact with it daily.
However, the software has faced scrutiny. The Verge reported that Meta paused a feature for sharing conversations after transcripts appeared publicly online, and one technology reviewer reported that the agent disclosed his home address to an unknown user on Facebook Marketplace.
Meta shares rose roughly 4 percent to 5 percent in after-hours trading Wednesday, trading around $726. The company forecast fourth-quarter revenue between $73 billion and $76 billion. A formal distribution date for the upcoming Class C shares has not yet been announced, and the company has not specified how it will resolve the New Mexico court judgment.
