S&P Global moves Meta credit outlook to negative on AI spending

S&P Global Ratings revised its outlook on Meta to negative from stable, citing uncertainty about how much the company will trim capital spending and how its free operating cash flow will develop. S&P now projects free operating cash flow deficits of about $22 billion in 2026 and $71 billion in 2027, narrowing to roughly $39 billion in 2028. The agency says leverage could exceed 1.0x as early as 2027, which is the downgrade threshold for Meta's AA- issuer rating. The change reflects the company's stated plan to raise equity to fund its AI buildout.

1. S&P Global Ratings revised its outlook on Meta Platforms to negative from stable, citing capital spending and free operating cash flow uncertainty.
2. S&P expects free operating cash flow deficits of $22 billion in 2026 and $71 billion in 2027, lessening to about $39 billion in 2028.
3. S&P said Meta's leverage could top 1.0x as early as 2027, the downgrade threshold for its AA- issuer credit rating.
4. Leverage rose from 0.1x in 2025, mainly because Meta leases data-center capacity rather than issuing debt, per S&P.
5. Meta guided 2026 capital expenditure to $135 billion to $145 billion and plans to sell about $97.5 billion of stock to fund AI investments.
6. Publication date not stated on the fetched page; first observed today.