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S&P Revises Meta Outlook to Negative, Citing Cash Flow and AI Capital Spending
S&P Global shifts Meta's outlook to negative, citing negative cash flow and uncertainty over AI capital spending.
Key points
- S&P affirmed Meta's AA- credit rating while revising the outlook to negative from stable.
- S&P projects Meta's capex at $140 billion this year, rising to $252 billion in 2028.
- Leverage is up from about 0.1x in 2025, largely because Meta leases data-center capacity.
Why it matters. S&P warned Meta's leverage could exceed 1.0x, the threshold for its current rating, as early as 2027.
S&P Global late Friday shifted its view on Meta to negative from stable, while affirming its AA- credit rating. The agency projects capex of $140 billion this year and free operating cash flow of -$22 billion, both figures S&P expects to stay weak. Leverage could exceed 1.0x as early as 2027, up from about 0.1x in 2025. Meta disagrees, saying its AI investments already deliver stronger engagement.
Latest updates
S&P Revises Meta Outlook to Negative, Citing Cash Flow and AI Capital Spending
S&P Global revised its outlook on Meta to negative from stable late on Friday. The agency cited negative cash flow and uncertainty around the company's capital expenditure plans. S&P affirmed Meta's AA- credit rating but warned about its financial trajectory. The move comes as Wall Street increasingly questions how long the AI spending boom can be sustained after third-quarter tech earnings. Fortune reported the rating action.