Mark Zuckerberg laid off 10 percent of Meta’s workforce last month, scrapped 6,000 open roles, and told the remaining 70,000 employees that the hard part was over. Two weeks later, the Financial Times reported that Meta is now exploring a stock sale worth tens of billions of dollars—because firing people, it turns out, still isn’t enough to pay for what Zuckerberg wants to build next.The layoffs were never really about efficiency. They were a line item. Meta’s capital expenditure for 2026 is projected at up to $145 billion—nearly double what the company spent last year—with most of it going into data centres, custom chips, and model training for what Zuckerberg is calling Meta Superintelligence Labs. CFO Susan Li said on the Q1 earnings call that the headcount cuts were meant to “offset the other investments we are making.” The 8,000 jobs, in management’s own framing, were a budget entry.Now Meta needs a bigger budget.
Google showed Big Tech that investors will fund the AI bill
The immediate trigger, according to the FT, was Alphabet’s record $85 billion equity raise earlier this month—the largest stock offering in history, surpassing Petrobras’s $70 billion deal from 2010. The offering was so oversubscribed that Alphabet upsized it by $5 billion, with Berkshire Hathaway alone putting in $10 billion. After watching that land, Meta’s internal discussions about a similar move intensified.The structure Meta has reportedly been studying is Alphabet’s use of mandatory convertible preferred shares—a mechanism that raises cash now but defers actual stock issuance potentially for years. It’s a way to fund infrastructure spending without immediately diluting shareholders. Goldman Sachs, which led the Google deal, would be well-positioned for a Meta mandate: Meta’s president Dina Powell McCormick spent 16 years at the bank before joining the company’s board and later taking an executive role focused specifically on AI financing strategy.Meta has not yet hired banks, and a company spokesperson called the share sale reports “pure speculation.” But the company also acknowledged it would “continue focusing on raising capital in the most flexible ways” to fund its AI ambitions—which is as close to a non-denial as corporate communications gets.
Meta has already borrowed $55 billion. The stock sale would be on top of that.
This wouldn’t be Meta’s first unconventional financing move. The company had less than $10 billion in long-term debt as recently as 2022. Since then it has borrowed $55 billion across a series of deals, including a $27 billion bond sale last October through a joint venture with private capital firm Blue Owl, structured to build a data centre in Louisiana that Meta internally refers to as “Hyperion.” It also halted share buybacks in late 2025 after repurchasing stock consistently since 2017.The math behind all of this is stark. Meta’s AI infrastructure spend is estimated at four to five times what the company pays in total employee compensation. Even eliminating the entire workforce wouldn’t come close to covering the bill. The binding constraint on Meta’s AI ambitions isn’t headcount—it’s GPUs and the electricity to run them.
Meta’s AI spending race puts it in the same boat as every other hyperscaler
Meta isn’t alone in this position. The four biggest US hyperscalers—Alphabet, Amazon, Meta, and Microsoft—are projected to spend a combined $725 billion on AI infrastructure in 2026. All of them are under pressure to explain how that spending eventually turns into returns. Alphabet’s equity raise gave investors a concrete answer; Meta is now trying to find its own version of that argument.What makes Meta’s situation slightly different is the lack of a cloud business to monetise excess compute. Google Cloud posted 63 percent year-on-year revenue growth in Q1, giving Alphabet a direct route to convert infrastructure spend into enterprise revenue. Meta’s path runs through advertising on Facebook, Instagram, and WhatsApp—and whatever Zuckerberg eventually builds on top of the AI foundation he’s paying so much to lay.Whether investors will price that potential the same way they priced Google’s is the question Meta’s bankers will need to answer.