S&P Global Ratings has downgraded its outlook for Meta Platforms to negative, citing concerns over the company's escalating capital expenditures. This shift follows Meta reporting its first negative free cash flow in over a decade, totaling approximately $2,12 billion for the third quarter of 2026.
Meta increased its 2026 capital expenditure guidance to a range of $135 billion to $145 billion, marking a $5 billion rise at the lower end. The company plans to dedicate approximately $825 billion to future data center and AI infrastructure projects.
To fund these initiatives without increasing debt, Meta is considering issuing a new class of non-voting shares and potential equity raises. These measures aim to secure capital while maintaining internal control over the company's strategic direction.
Market reaction included a rise in Meta’s five-year credit default swaps to 114,79 basis points as of October 22, 2026. While credit analysts express caution regarding financial flexibility and leverage, equity analysts have generally raised price targets, citing the resilience of the core advertising business.
