Meta Platforms Inc. has secured approximately $96 billion in investor orders for its latest bond sale, according to sources familiar with the transaction. The Facebook parent company is ramping up spending on artificial intelligence infrastructure, driving demand for capital.
Bond Sale Details
The company launched a $25 billion sale of investment-grade notes on Thursday, with the offering split into six parts. The longest-dated security, maturing in 2066, is priced to yield 1.47 percentage points above Treasuries, tighter than initial talk of up to 1.8 percentage points. This compares to Meta's prior deal in October, which attracted a record $125 billion in orders for $30 billion of supply.
Citigroup Inc. and Morgan Stanley are managing the transaction, which is one of 12 bond deals in the market. Citi declined to comment on order size, while Morgan Stanley and Meta did not immediately respond to requests for comment.
AI Investment Frenzy
Big tech companies are borrowing heavily as they compete for dominance in artificial intelligence. Investors have readily absorbed bond supply from these firms, even amid volatility tied to geopolitical tensions, underscoring relentless demand for exposure to the AI boom. However, some signs of fatigue are emerging after roughly $300 billion of AI-related debt has been sold, including project finance and unsecured notes from hyperscalers. Money managers are increasingly demanding higher risk premiums and more protections.
Meta's 40-year bond sold in October had a spread of 1.1 percentage points over Treasuries, nearly 0.4 percentage points tighter than Thursday's equivalent security. The company's shares plunged by the most in six months on Thursday amid concerns that Meta's AI investments may not pay off. Costs to insure its debt against default hit a fresh record high.
Market Reaction
“With the equity lower after earnings, they probably sweeten the yield on the sale today so the deal not only clears but also trades well — setting them up nicely for future issuances,” said Grant Nachman, founder and chief investment officer of Shorecliff Asset Management Co.
The debt sale comes a day after Meta posted better-than-expected revenue for the first quarter and raised projected 2026 capital expenditures to as much as $145 billion. Other hyperscalers also reported results on Wednesday, and the four biggest firms are now planning to spend as much as $725 billion this year on AI data center equipment and other capital expenditures.
CEO's Vision
Chief Executive Mark Zuckerberg has stated that Meta will spend hundreds of billions of dollars on AI infrastructure by the end of the decade, even before a memory chip shortage triggered a surge in prices. The company has announced billion-dollar deals with Nvidia Corp., Advanced Micro Devices Inc., and Broadcom Inc. for chips and other hardware in 2026 and is building several massive data centers to power its efforts.
