Meta shares fell 6% after reporting negative free cash flow of $2.12 billion and raising the lower end of its 2025 capex range to $135 billion, as credit default swaps hit all-time highs.
01Summary
- 01Meta's share price dropped roughly 6% on Thursday.
- 02Free cash flow was negative $2.12 billion in the third quarter.
- 03Meta raised its full-year capital expenditure floor to $135 billion, from $130 billion, keeping the ceiling at $145 billion.
- 04The spread on Meta's five-year credit default swaps reached all-time highs.
- 05Meta plans to create a new class of nonvoting Class C common stock to maintain its founder-led structure.
02Why it matters
This matters because Meta's escalating AI spending and negative cash flow signal potential financial strain, which could affect shareholder returns and the company's ability to invest in new products.
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