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Facebook-parent Meta Platforms Inc (NASDAQ: META) said it had raised $10 billion in its first-ever bond offering as it looks to fund share buybacks and investments to revamp its business.Last week, Meta said it will issue bonds to use the proceeds for capital expenditures, share repurchases, acquisitions or investments.
The offering would help the social media giant, the only prominent technology company without debt on its books, build a more traditional balance sheet and fund some expensive initiatives, such as its metaverse virtual reality.
The company's free cash flow has been draining as it is speedily moving ahead with its metaverse plans.
In the second quarter ended June 30, Meta had $4.45 billion in free cash flow, compared with $8.53 billion in the prior quarter. In late July, the social media giant also reported a drop in quarterly revenue for the first time.
On a post-earnings conference call, CFO Dave Wehner said the company had a "substantial amount" in its buyback program and expects to continue with buybacks as part of its capital allocation strategy.
Meta received an 'A1' rating from Moody's and an 'AA- rating' and a 'stable' outlook from Standard&Poors.
Other tech giants such as Apple Inc (NASDAQ: AAPL) and Intel Corp (NASDAQ: INTC) also issued bonds recently, raising $5.5 billion and $6 billion, respectively.
Picture Credit: Business Insider
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