Meta non-voting stock: one Class C share for each A or B share

Key takeaways

• Meta plans to create a non-voting Class C stock and hand every shareholder one Class C share for each Class A or Class B share they own, according to its Oct. 21, 2026 earnings release and an SEC Form 8-K.
• The company's charter amendment is set to take effect on Jan. 19, 2027. Record and payment dates for the stock dividend have not been set yet.
• Meta says the new shares can be used for capital raising, employee pay and acquisitions without changing anyone's voting power.
• Third-quarter revenue rose 26% to $64.60 billion, while costs and expenses jumped 68% to $51.61 billion, including a $9.89 billion legal charge.
• Meta narrowed its 2026 capital expenditure outlook to $135 billion to $145 billion as it keeps spending heavily on AI, including its Muse models and personal agents.

What is Meta's new non-voting stock?

Meta non-voting stock is coming: the company plans to give every shareholder one new Class C share, with no vote on corporate matters, for each Class A or B share they own. Meta announced the plan with its third-quarter 2026 results on Oct. 21.

Today Meta has two classes of common stock. Class A shares trade on Nasdaq under the ticker META and carry one vote each. Class B shares, held mostly by insiders, carry ten votes each and are not listed. That structure gives co-founder and chief executive Mark Zuckerberg majority voting control, as Meta has disclosed in past proxy filings.

According to the Form 8-K, Meta's board approved an amended and restated certificate of incorporation on Oct. 19 that creates the Class C shares. The board acted on the unanimous recommendation of a special committee of independent directors. Stockholders then approved the change by written consent on Oct. 20, so there will be no shareholder vote at a meeting. Meta said it intends to list Class C on Nasdaq.

How the stock dividend works for existing holders

Meta will not sell the first batch of Class C shares. Instead, it will distribute them as a one-time stock dividend: one Class C share for every Class A or Class B share. Someone who owns 10 Class A shares on the record date would end up with 10 Class A shares and 10 Class C shares.

Meta said in its release that, once the dividend is paid, it expects the Class A share price to reflect the effect of a two-for-one split. In plain terms, the same company value would be spread across twice as many shares, half of which have no vote. The dividend itself does not raise money, and Meta says it does not change the voting power of any holder.

The key dates are only partly known. The 8-K says the dividend was declared on Oct. 19, conditional on the new charter taking effect, and that the board will set the record and payment dates later. A separate agreement with Zuckerberg requires payment no later than the fifth business day after the charter becomes effective.

Why Meta wants a tradable non-voting currency

Meta's chief financial officer, Susan Li, said the shares are meant to be "usable for capital raising, employee compensation, acquisitions, and other general corporate purposes," according to TechCrunch. Each of those uses normally involves issuing new stock.

The problem with issuing more Class A shares is that every new voting share slightly dilutes the voting power of existing holders, including Zuckerberg. Non-voting Class C shares let Meta pay engineers, buy companies or sell stock to investors while leaving the voting split between Class A and Class B untouched. Semafor, which first reported the plan, wrote that the structure points to Meta relying more on share sales to fund its AI buildout.

There is a well-known precedent. Semafor noted that Google's parent, now Alphabet, created non-voting Class C shares through a similar split in 2014, which helped its founders keep control while the company kept issuing stock.

Timing also matters. Meta made no share buybacks in the third quarter, compared with $3.33 billion a year earlier, according to its release. When large technology companies stop buying back stock while still paying staff in shares, they tend to become net issuers. A non-voting class lets that issuance continue without shifting control.

The Zuckerberg agreement attached to the plan

Meta also signed a "Founder Alignment Agreement" with Zuckerberg, dated Oct. 20 and filed as an exhibit to the 8-K. The main terms, as described in the filing, are:

• Limits on selling. Only 20% of the Class C shares that Zuckerberg's holder group receives in the dividend can be sold freely. The other 80% are "stapled": they can only be sold together with an equal sale or conversion of his Class A or Class B shares, unless he has earned credits from earlier sales.
• Gradual release. 2.5% of those Class C shares are released each quarter in which he remains full-time on the executive team or serves as executive chair, with full release after 32 such quarters.
• Staying put. He commits to remain in California, or wherever Meta is headquartered, for eight years, absent material unforeseen circumstances.
• Possible extra dividends. Additional one-for-one Class C dividends could follow each time the Class C 30-day average price doubles relative to a reference Class A price of $580.60 from Sept. 10, 2026, provided annualized shareholder returns reach at least 10%.
• Buyback pairing. If Meta repurchases Class A shares, it must use best efforts to buy back an equal number of Class C shares.

Breaching the selling limits would trigger an automatic conversion of Class B shares into Class A shares, which would reduce Zuckerberg's voting power, according to the filing.

The residency commitment is linked to a possible California wealth tax; our follow-up explains why Meta struck a deal to keep Zuckerberg in California and how the Class C shares fit into it.

Q3 results: revenue up 26%, costs up 68%

The share plan arrived with a quarter of strong advertising growth and much heavier spending. The table below shows the headline figures Meta reported for the quarter ended Sept. 30, 2026.

Most of the cost jump came from one item. Meta recorded a $9.89 billion charge tied to an August 2026 agreement with 52 state attorneys general over litigation about teen mental health and social media. That agreement provides for payments of up to about $18.59 billion, according to the release. Without the charge, operating income would have been $22.88 billion.

Even excluding the charge, costs grew far faster than revenue. By Bullquill's calculation from Meta's figures, costs and expenses excluding the legal charge rose about 36% year over year, against 26% revenue growth. Capital expenditures of $34.91 billion in a single quarter, including finance lease principal payments, show how much of that spending is going into data centers and AI infrastructure.

Guidance and the cost of the AI buildout

Meta guided fourth-quarter revenue to $73 billion to $76 billion, including about a 1% foreign-exchange headwind. It raised its full-year 2026 total expense outlook to $175 billion to $179 billion to include the legal charge, and narrowed full-year capital expenditures to $135 billion to $145 billion, from $130 billion to $145 billion previously.

Meta did not give a 2027 revenue forecast, but said it expects to "sustain strong overall revenue growth throughout 2027" and to keep investing aggressively in its core business and AI. It expects Reality Labs losses of $18 billion to $19 billion in 2026, narrowing to around $15 billion next year as investment shifts toward AI.

Not every company is raising its spending plans: Tesla cut its 2026 capital-spending plan to about $20 billion from more than $25 billion, according to its third-quarter results.

Where Muse fits in

The spending is tied to Meta's Muse family of AI models and assistants. In the release, Zuckerberg pointed to "launching Muse and Muse Wonder, our first frontier model," and said "our investments are paying off, the core business is strong."

According to TechCrunch, Meta has released several Muse models, including an open-weight version, a coding agent called Muse Code, and new avatars for its Meta Muse assistant. Zuckerberg told analysts that "more than 10 million people in the U.S. and Canada have set up Muse personal agents" in about a month and a half, TechCrunch reported.

That is where the new stock comes in. Building frontier models and the data centers that run them requires cash, chips and scarce AI researchers. Meta frames Class C as a way to pay for parts of that, through share sales, stock-based pay or acquisitions, without weakening founder control. Other big AI spenders face the same pressure, as seen in recent results from AI server maker Super Micro and SpaceX's growing AI business.

What is not yet disclosed

• The record date and payment date for the Class C dividend.
• Whether, when or how much Class C stock Meta will sell to raise capital. The company has not announced an offering.
• Whether Class C shares will receive the same cash dividend as Class A shares. The release and 8-K reviewed for this article do not say.
• The tax treatment of the stock dividend for holders, which the release and 8-K do not describe.
• How the market will price non-voting shares relative to voting Class A shares once both trade.

Because stockholders approved the change by written consent, Meta must send shareholders an information statement on Schedule 14C. Under SEC rules, it must go out at least 20 calendar days before the action takes effect. The 8-K says a preliminary version was due to be filed around Oct. 19, and it may contain more detail.

What it means

For existing holders, the immediate effect is mechanical: more shares, a lower price per Class A share after the split effect, and no change to their voting power. The bigger change is strategic. Meta is giving itself a new way to fund an AI program that already pushed quarterly costs up 68%, while the founder's voting control stays protected and his sales are limited by the new agreement.

The open questions are how much stock Meta eventually issues and how investors value shares with no vote. The answers will depend on Meta's capital needs in 2027, on whether its Muse products turn into meaningful revenue, and on legal and regulatory risks that Li flagged on the call, including several U.S. trials on youth-related issues scheduled in the coming months, according to TechCrunch. For more on the AI infrastructure race, see our explainer on Google TorchTPU, Amazon TorchNeuron and Nvidia CUDA and our report on OpenAI models coming to Google Cloud.

Figures in this article are as reported by Meta on Oct. 21, 2026, for the quarter ended Sept. 30, 2026.

Sources

• Meta Reports Third Quarter 2026 Results (Meta press release, Oct. 21, 2026)
• Meta Platforms, Inc. Form 8-K, including the Founder Alignment Agreement (SEC EDGAR)
• Meta Investor Relations
• Meta wants to pay for its broad AI buildout with a newly created class of stock (TechCrunch)
• Meta plans nonvoting shares, eyeing more stock sales to fund its AI dreams (Semafor)

This article is for information only and is not investment advice.