Meta set to raise $25 bn in its biggest-ever bond sale to fund AI expansion

Meta Platforms' $25 billion bond sale, among the biggest US corporate bond offerings of 2025, will help the company to ramp up AI infrastructure and integrating AI services into core products

Meta Platforms Inc will raise at least $25 billion through sales in investment-grade bonds, the company said on Thursday. This comes a day after chief executive Mark Zuckerberg announced plans to ramp up spending on artificial intelligence (AI) in the coming year. The sale is expected to be among the largest US corporate bond offerings of 2025, Bloomberg reported. 

The planned bond sale follows a $27 billion private bond transaction earlier this month that funded a Meta data centre project in Louisiana, US. The project is 80 per cent owned by Blue Owl Capital Inc and much of its debt was initially purchased by Pacific Investment Management Co (PIMCO).  Meta’s latest offering adds to a growing wave of financing by large tech firms. According to Morgan Stanley, hyperscalers, which includes the world’s largest technology companies such as Meta, Microsoft, and Alphabet, are projected to spend about $3 trillion on data centres between now and the end of 2028. Roughly half of that spending will come from internal cash flows, while the rest is expected to rely on credit markets, Bloomberg reported. 

   

 

Lower rates fuel AI investment

Meta and its tech peers are taking advantage of declining borrowing costs as the US Federal Reserve cuts interest rates.  Meanwhile, investors are eager to secure still-elevated yields, making the environment favourable for big bond issuances. 

The company plans to spend as much as $72 billion in capital expenditure this year, with an even sharper rise projected for 2026. Much of this investment will go into AI infrastructure and integrating AI services into core products such as Facebook and Instagram. However, Meta’s announcement spooked investors, with the company’s shares falling by as much as 14 per cent on Thursday after the spending plans were revealed. 

Meta’s deal follows other major tech debt sales, including Oracle Corp.’s $18 billion high-grade bond issue last month. Banks are also working on a $38 billion debt deal to support Oracle’s data centre expansion, potentially the largest AI-related financing deal to date.

 

Meta’s long-term AI strategy

Meta plans to issue bonds in as many as six tranches, with maturities ranging from 5 to 40 years. The 40-year bond is expected to offer a yield about 1.4 percentage points above benchmark Treasuries, Bloomberg reported. 

Zuckerberg and Chief Financial Officer Susan Li told analysts that Meta’s heavy AI investments are already improving the company’s ad targeting and content recommendation systems, which remain the backbone of its business. Meta reported a 26 per cent rise in third-quarter revenue to $51.2 billion, driven primarily by advertising, which accounts for about 98 per cent of its income.