Latest news with #MetaPlatforms
Yahoo
a day ago
- Business
- Yahoo
Meta Picks Pimco, Blue Owl for $29B Data Center Deal
Meta Platforms Inc. has selected Pacific Investment Management Co. and Blue Owl Capital Inc. to lead a $29 billion financing for its data center expansion in rural Louisiana as the race for artificial intelligence infrastructure heats up, according to people with knowledge of the matter. Pimco is expected to lead a $26 billion debt portion of the financing, while Blue Owl is providing $3 billion of equity, said the people, who asked not to be identified because the discussions are private. The debt portion is likely to be issued in the form of investment-grade bonds backed by the data center's assets, they said. Mark Mahaney, senior managing director and head of internet research at Evercore ISI says Meta is reaccelerating their revenue growth using AI.
Yahoo
2 days ago
- Business
- Yahoo
Prediction: Reddit Stock Could Outperform Meta and Snap Over the Next 12 Months
Key Points The ever-rising social media star posted gangbusters results in its second quarter. That wasn't only because of its cutting-edge ad technology, although that certainly helped. 10 stocks we like better than Reddit › One of the hottest tech companies on the stock market is also, in a way, one of its more old-fashioned. Reddit's (NYSE: RDDT) website doesn't feature flashy graphics or funky designs; rather, it's a set of online discussions about almost any topic imaginable. This outwardly mundane presentation hides a high-potential operation that has more than proved it can deliver the goods for investors. Given that, I think the stock price growth of the dowdy-looking Reddit can trounce that of social media peers Meta Platforms (NASDAQ: META) and Snap (NYSE: SNAP) over the coming year. The social media rock star of the moment The excitement over Reddit across the past few days stems from its second-quarter earnings report, published Friday morning to a thunderously positive reception by the market (which sent the share price more than 21% skyward in morning trading alone). Revenue surged 78% higher on a year-over-year basis to $500 million, powered by all-important ad sales that rose 84% to $465 million. The bottom line according to generally accepted accounting principles (GAAP) flipped to a well-in-the-black profit of $89 million, against a $10 million deficit in the same quarter of 2024. Free cash flow (FCF) ballooned by $84 million across that stretch to $111 million. Both headline figures blew past analyst estimates. As for operational metrics, the company's count for daily active uniques (DAUq) -- users that it defines as those "whom we can identify with a unique identifier who has visited a page on the Reddit website ... or opened a Reddit application at least once during a 24-hour period" -- leaped by 21% year over year to over 21 million souls. How's that for engagement? Reddit's guidance for its current (third) quarter was similarly impressive. It's projecting $535 million to $545 million for revenue, and adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) of $185 million to $195 million. Analysts were anticipating a top line of barely over $473 million. The right site at the right time So, what's the secret sauce for Reddit? Sure, management has launched several clever, growth-fueling initiatives, including dynamic product ads (DPA), rolled out in May. These spots match topics of the site's "subreddits," and embed within them to serve users who are obviously or apparently looking to buy such products/services. In the ideal case, the ads are doubly beneficial, as a shopper in need of guidance gets a tailored recommendation, and a theoretically ideal consumer is targeted by an advertiser. Also in the realm of ads, Reddit is future-forward with its embrace of artificial intelligence (AI) tools for ad creation. With these, an advertiser can garner real-time information on trends in the discussion threads, plus integrate positive user comments into the ads themselves. But I don't believe Reddit's big leaps are mostly due to these (admittedly impressive) technologies. Rather, I think it's more a function of what the company offers as a service. With the ability to generate meaningful discussion about almost anything and provide answers for a near-limitless variety of questions or concerns, Reddit is growing in both authority and utility. As successful as Meta's Facebook and Instagram and Snap's offerings have been, they're not really venues for information swapping or edification. They're fun places to share things with friends and acquaintances. However, you would be hard-pressed to quickly access an effective informational discussion on the history of the Habsburg Empire. I think analysts tracking social media and big-tech stocks have cottoned on to this. They're modeling nearly 60% (!) annual growth for Reddit on the top line for full-year 2025, with a 31% boost in 2026. The collective estimate for per-share profitability is $1.86, a night-and-day improvement over a $3.33 loss in 2024. That should balloon by 61% (!!) in 2026. Neither revenue nor profitability are expected to surge anywhere near that high for Meta from 2025 to 2026. Analysts forecast Snap will improve its bottom line by 42% across that stretch, but with revenue growth of 11%. High performance attracts investors, of course, so Reddit's valuations are comparatively much higher than its social media cousins (a dizzying 121 forward price-to-earnings ratio, for example, against Snap's under 37, and Meta's sub-29). Yet this company has clearly captured the zeitgeist and possesses the user stickiness, the resources, and the managerial acumen to keep up those massive growth rates. Of that trio, then, I would unhesitatingly buy Reddit stock. Should you buy stock in Reddit right now? Before you buy stock in Reddit, consider this: The Motley Fool Stock Advisor analyst team just identified what they believe are the for investors to buy now… and Reddit wasn't one of them. The 10 stocks that made the cut could produce monster returns in the coming years. Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you'd have $636,563!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you'd have $1,108,033!* Now, it's worth noting Stock Advisor's total average return is 1,047% — a market-crushing outperformance compared to 181% for the S&P 500. Don't miss out on the latest top 10 list, available when you join Stock Advisor. See the 10 stocks » *Stock Advisor returns as of August 4, 2025 Eric Volkman has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Meta Platforms. The Motley Fool has a disclosure policy. Prediction: Reddit Stock Could Outperform Meta and Snap Over the Next 12 Months was originally published by The Motley Fool Sign in to access your portfolio
Yahoo
2 days ago
- Business
- Yahoo
Meta's $29 Billion Deal Marks Key Moment for Private Credit
(Bloomberg) -- The heavy hitters of private credit have been waiting for this moment for years. All Hail the Humble Speed Hump Three Deaths Reported as NYC Legionnaires' Outbreak Spreads Mayor Asked to Explain $1.4 Billion of Wasted Johannesburg Funds Major Istanbul Projects Are Stalling as City Leaders Sit in Jail Chicago Schools' Bond Penalty Widens as $734 Million Gap Looms Major lenders, which often cater to companies with dented credit, talk endlessly about the opportunities in investment-grade debt and in financing the breakneck growth of artificial intelligence. They've done smaller deals, but this week they caught the biggest fish yet: a $29 billion financing package for Meta Platforms Inc.'s massive data center in Louisiana. That transaction, led by Pacific Investment Management Co. and Blue Owl Capital Inc., hits all the high notes: It's a top-notch business in a hot sector. It disrupts the usual route that companies like Meta travel to get money from investors through banks. And, it's huge. 'Private credit has been itching to get into this space,' said John Medina, senior vice president on the global project and infrastructure finance team at Moody's Ratings. 'This deal is one of the first of its kind for private credit and if it is successful, we would expect to see more.' The biggest technology companies are in an AI arms race now, and they need cash to win. Elon Musk's xAI Corp. recently told investors it plans to spend $18 billion on data centers, and is looking at raising debt backed by projects rather than at the corporate level. Others including Inc. and OpenAI Inc. are pursuing their own sites across the US. Morgan Stanley estimates that capital expenditures on AI could exceed $3 trillion in the next three years. For Meta, Pimco is leading $26 billion in debt and Blue Owl is providing $3 billion in equity. The debt portion is likely to be issued in the form of investment-grade bonds backed by the data center's assets, people familiar with the matter said, adding that the final structure is still in flux. Morgan Stanley is advising Meta on the deal and arranging the financing. The bidding war for the financing lasted months. It was competitive because private credit firms have been all-but-begging for access to the investment-grade debt world that banks dominate. Other private credit firms that grappled for the top spot include Apollo Global Management Inc. and KKR & Co., which made it to the final round, as well as Brookfield Asset Management Ltd., Blackstone Inc. and Ares Management Corp., said the people, who were not authorized to speak publicly. It is the largest funding package related to a specific AI data center by a mile, with others involving xAI Corp. or Coreweave Inc. well below $10 billion. Microsoft Inc., BlackRock Inc. and the United Arab Emirates' MGX investment vehicle are teaming up to raise $30 billion of private equity that can be leveraged to $100 billion, with Nvidia Corp. and xAI also joining in, but that money is for a series of data warehouses and energy infrastructure rather than an individual project. The most recent debt deal of any kind that's even near the size of Meta's was a $26 billion bond sale to support Mars Inc.'s purchase of rival food-maker Kellanova in March. A group of banks put together the financing, which was funneled through to their typical investors in the syndicated market. Dry Powder Private credit firms have about $450 billion of dry powder to invest, according to Preqin data, and are clamoring for this kind of business. The corporate acquisitions that often fuel private credit deals are practically at a standstill. And these firms aspire to more fully become rivals to traditional Wall Street banks — handling everything from advising companies to structuring their debt to providing some of it themselves. Expanding further into investment-grade deals could help make private credit a $40 trillion market, according to an estimate from Apollo. 'This ecosystem of private investment-grade is a massive market with a huge tailwind,' Michael Zawadzki, the global chief investment officer at Blackstone's credit and insurance unit, said last year. Representatives for Apollo, Meta, Pimco, Blue Owl, Brookfield, Blackstone, Ares and Morgan Stanley declined to comment. Those for KKR and xAI didn't immediately respond to requests for comment. KKR and Energy Capital Partners last year agreed to a $50 billion partnership to accelerate the development of infrastructure for artificial intelligence. Blue Owl has helped finance AI infrastructure before, including through a $15 billion joint venture for a data center in Abilene, Texas. Blue Owl Chief Executive Officer Marc Lipschultz has compared the AI craze to the Gold Rush: though lenders aren't out there digging for treasure, they can provide the 'picks and shovels' that technology firms need. 'In this case, it takes the modern version, the data centers,' he said during a conference call on July 31. 'And we are the best placed firm to help develop and to help fund those data centers.' --With assistance from Laura Benitez and Kurt Wagner. (Updates with previous Blue Owl investment in fourteenth paragraph.) The Pizza Oven Startup With a Plan to Own Every Piece of the Pie Digital Nomads Are Transforming Medellín's Housing Russia's Secret War and the Plot to Kill a German CEO It's Only a Matter of Time Until Americans Pay for Trump's Tariffs The Game Starts at 8. The Robbery Starts at 8:01 ©2025 Bloomberg L.P. 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The Hill
2 days ago
- Business
- The Hill
Meta settles with conservative activist over AI chatbot lawsuit
Meta Platforms settled a defamation lawsuit with Robby Starbuck, who claimed that Meta's artificial intelligence (AI) falsely accused him of participating in the Jan. 6 Capitol riots. There is no publicly available information on the details of the settlement except that Robby Starbuck, a conservative activist working against diversity, equity and inclusion (DEI), will work with Meta to remove 'ideological and political bias' from the company's AI. 'Both parties have resolved this matter to our mutual satisfaction. Since engaging on these important issues with Robby, Meta has made tremendous strides to improve the accuracy of Meta AI and mitigate ideological and political bias,' a joint statement from Meta and Starbuck reads. 'Building on that work, Meta and Robby Starbuck will work collaboratively in the coming months to continue to find ways to address issues of ideological and political bias and minimize the risk that the model returns hallucinations in response to user queries,' he added. Meta did not immediately respond to The Hill's request for comment. Starbuck on Friday told CNBC's 'Squawk Box' that both himself and Meta saw that this problem could impact other users of the company's platforms. 'That was always the point of my lawsuit — is fix this for everybody so this doesn't become a massive, you know, really terrible story in the future where AI affects elections in ways that no one is comfortable with,' he said. Starbuck dodged a question from host Andrew Ross Sorkin about how much money was rewarded, stating that he is still figuring out the details of the collaboration with the tech giant. 'Delivering fairness for consumers is the outcome I've always wanted and I'm pleased to do the work to make that a reality,' Starbuck wrote on social media. 'As we move into a future where AI dominates many parts of our world, now you know that you have an unshakable voice at the table to advocate for ideological fairness.' Starbuck filed the suit against Meta on April 29 and originally demanded more than $5 million from the company. On April 30, Joel Kaplan, Meta's chief global affairs officer, apologized publicly over the matter. 'Robby – I watched your video – this is unacceptable. This is clearly not how our AI should operate. We're sorry for the results it shared about you and that the fix we put in place didn't address the underlying problem,' he posted on the social media platform X.
Yahoo
2 days ago
- Business
- Yahoo
Meta's $29 Billion Deal Marks Pivotal Moment for Private Credit
(Bloomberg) -- The heavy hitters of private credit have been waiting for this moment for years. All Hail the Humble Speed Hump Three Deaths Reported as NYC Legionnaires' Outbreak Spreads Mayor Asked to Explain $1.4 Billion of Wasted Johannesburg Funds Major Istanbul Projects Are Stalling as City Leaders Sit in Jail Chicago Schools' Bond Penalty Widens as $734 Million Gap Looms Major lenders, which often cater to companies with dented credit, talk endlessly about the opportunities in investment-grade debt and in financing the breakneck growth of artificial intelligence. They've done smaller deals, but this week they caught the biggest fish yet: a $29 billion financing package for Meta Platforms Inc.'s massive data center in Louisiana. That transaction, led by Pacific Investment Management Co. and Blue Owl Capital Inc., hits all the high notes: It's a top-notch business in a hot sector. It disrupts the usual route that companies like Meta travel to get money from investors through banks. And, it's huge. 'Private credit has been itching to get into this space,' said John Medina, senior vice president on the global project and infrastructure finance team at Moody's Ratings. 'This deal is one of the first of its kind for private credit and if it is successful, we would expect to see more.' The biggest technology companies are in an AI arms race now, and they need cash to win. Elon Musk's xAI Corp. recently told investors it plans to spend $18 billion on data centers, and is looking at raising debt backed by projects rather than at the corporate level. Others including Inc. and OpenAI Inc. are pursuing their own sites across the US. Morgan Stanley estimates that capital expenditures on AI could exceed $3 trillion in the next three years. For Meta, Pimco is planning to arrange $26 billion in debt and Blue Owl is providing $3 billion in equity. The debt portion is likely to be issued in the form of investment-grade bonds backed by the data center's assets, people familiar with the matter said, adding that the final structure is still in flux. The bidding war for the financing lasted months. It was competitive because private credit firms have been all-but-begging for access to the investment-grade debt world that banks dominate. Other private credit firms that grappled for the top spot include Apollo Global Management Inc. and KKR & Co., which made it to the final round, as well as Brookfield Asset Management Ltd., Blackstone Inc. and Ares Management Corp., said the people, who were not authorized to speak publicly. Morgan Stanley advised Meta on the deal but isn't leading the financing. It is the largest funding package related to a specific AI data center by a mile, with others involving xAI Corp. or Coreweave Inc. well below $10 billion. Microsoft Inc., BlackRock Inc. and the United Arab Emirates' MGX investment vehicle are teaming up to raise $30 billion of private equity that can be leveraged to $100 billion, with Nvidia Corp. and xAI also joining in, but that money is for a series of data warehouses and energy infrastructure rather than an individual project. The most recent debt deal of any kind that's even near the size of Meta's was a $26 billion bond sale to support Mars Inc.'s purchase of rival food-maker Kellanova in March. A group of banks put together the financing, which was funneled through to their typical investors in the syndicated market. Dry Powder Private credit firms have about $450 billion of dry powder to invest, according to Preqin data, and are clamoring for this kind of business. The corporate acquisitions that often fuel private credit deals are practically at a standstill. And these firms aspire to more fully become rivals to traditional Wall Street banks — handling everything from advising companies to structuring their debt to providing some of it themselves. Expanding further into investment-grade deals could help make private credit a $40 trillion market, according to an estimate from Apollo. 'This ecosystem of private investment-grade is a massive market with a huge tailwind,' Michael Zawadzki, the global chief investment officer at Blackstone's credit and insurance unit, said last year. Representatives for Apollo, Meta, Pimco, Blue Owl, Brookfield, Blackstone, Ares and Morgan Stanley declined to comment. Those for KKR and xAI didn't immediately respond to requests for comment. KKR and Energy Capital Partners last year agreed to a $50 billion partnership to accelerate the development of infrastructure for artificial intelligence. Blue Owl CEO Marc Lipschultz has compared the AI craze to the Gold Rush: though lenders aren't out there digging for treasure, they can provide the 'picks and shovels' that technology firms need. 'In this case, it takes the modern version, the data centers,' he said during a conference call on July 31. 'And we are the best placed firm to help develop and to help fund those data centers.' --With assistance from Laura Benitez and Kurt Wagner. The Pizza Oven Startup With a Plan to Own Every Piece of the Pie Digital Nomads Are Transforming Medellín's Housing Russia's Secret War and the Plot to Kill a German CEO It's Only a Matter of Time Until Americans Pay for Trump's Tariffs The Game Starts at 8. The Robbery Starts at 8:01 ©2025 Bloomberg L.P. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
