The company will create non-voting shares and hand them to existing shareholders as a dividend, giving it a new tool to raise money without diluting founder control.
Meta is preparing to create a new class of non-voting stock to help pay for its push into artificial intelligence. The company confirmed the plan on Wednesday, as it reported third-quarter earnings, after Semafor first reported that Meta was weighing the move.
What Meta Said?
On the earnings call, chief financial officer Susan Li said the company plans to “create a new class of non-voting capital stock, which will be distributed to all existing shareholders through a stock dividend.”
Non-voting shares give their owners a stake in the company but no say in its decisions. Li explained that Meta “created this new class of shares with the purpose of creating a publicly traded non-voting stock usable for capital raising, employee compensation, acquisitions, and other general corporate purposes while preserving the voting power of existing Class A and B shareholders.”
She said the structure lets Meta keep its “founder-led structure”. It also widens the company’s “funding tools” and gives it “flexibility to invest behind the unprecedented momentum we’re seeing across every part of our business, driven by AI.”
A Strong Quarter, With Rising Costs
The announcement came alongside results that beat Wall Street expectations. Meta reported $64 billion in revenue, up 26% from a year earlier. Costs and expenses grew much faster, however, rising 68% year over year.
Reality Labs, the division behind Meta’s AR glasses, VR headsets and VR software, is still losing money, though less than before. In its earnings report, the company said it expects the division’s losses to shrink from 2025 levels to between $18 billion and $19 billion.
The AI Push Behind the Spending
Meta has been expanding its AI lineup aggressively over the past year. Earlier this year it released models including Muse Spark and Muse Glimmer. In recent weeks it added Muse Wonder and Muse Spark Open, an open-weight model whose underlying parameters are publicly available for outsiders to use and build on.
The company has also launched Muse Code, a coding agent for software developers. At this year’s Meta Connect event, it introduced a new line of friendly, cartoon-style avatars for its AI assistant, Meta Muse, in an effort to make its AI services feel more relatable.
According to the company, the products are gaining traction. CEO Mark Zuckerberg told the earnings call that “in just a month and a half, more than 10 million people in the U.S. and Canada have set up Muse personal agents.” He added that “growth continues to be strong, and we have been number one in the App Store almost every day.”
Zuckerberg said Muse now has “clear product-market fit” and that Meta is “entering a new phase and a more operational phase that is focused on scaling it.” He later said the company expects the product’s appeal to grow to eventually “serve billions of people.” These figures come from the company itself and have not been independently verified.
Legal and Regulatory Risks Remain
Li also flagged risks that could weigh on the business. “We continue to monitor active legal and regulatory matters that could significantly impact our business and financial results,” she said. She pointed to continued scrutiny of youth-related issues in several markets, and noted that a number of youth-related trials are scheduled in the United States in the coming months.
What to Watch Next?
The new share class gives Meta a flexible way to raise money, pay employees and make acquisitions while the voting power of current Class A and B shareholders stays intact. With costs rising far faster than revenue, how Meta uses that flexibility, and how investors respond to non-voting shares, will be worth following.
