Meta Raises $10 Billion in First Bond Offering Ever

Daniel Attoe
Daniel Attoe

Updated · Aug 10, 2022

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The tech giant took its first steps into the debt market on Tuesday as it looks to bolster its disappointing earnings.

Meta Bonds

Facebook parent company Meta Platforms has raised $10 billion in its first-ever bond offering. Prior to this, it was one of the few firms in the S&P 500 without any debt.

The social media company’s decision comes as it explores ways to fund its operations and maintain a healthy cash flow. 

The raised capital will play a vital role in helping Meta to revamp its business, which covers a host of products and services, and its metaverse project. It will also fund stock buybacks from shareholders. 

Its decision to enter the bond market is not unrelated to the company’s current balance sheet distress. Last month, Meta’s earning results for 2022 Q2 revealed its first-ever quarterly fall in revenue

Both in-house and analyst forecasts for the next quarter are just as gloomy. Looming fears of a recession and competition from rivals like TikTok have taken a toll on its ad business. 

Other Giants Tapping the Debt Market

With this offering, the US-based multinational joins a prestigious list of tech giants that have raised funds in the bond market.

Earlier in the month, iPhone maker Apple tapped the market with a $5.5 billion sale in four parts. According to reports, the company earmarked the funds for general corporate purposes, including the financing of share buybacks and dividends.

Similarly, Intel Corp. issued $6 billion in senior notes last Friday. This includes $1.25 billion in green bonds due 2032. The chip maker intends to use the funds for investing in eco-friendly projects, like green buildings or energy efficiency.

Sources.

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Daniel Attoe

Daniel Attoe

Daniel is an Economics grad who fell in love with tech. His love for books and reading pushed him into picking up the pen - and keyboard. Also a data analyst, he's taking that leap into data science and machine learning. When not writing or studying, chances are that you'll catch him watching football or face-deep in an epic fantasy novel.

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