Investing in Meta’s metaverse products and other initiatives can net you bonds to invest.
New investments and operations take capital and Meta is planning on the first set of bonds being offered by the company to be the catalyst for its growth. The company is poised to sell $10Bn in debt in order to fund buybacks and keep a healthy cash flow, this information comes from two individuals with deep knowledge of the inside workings of the company.
Meta is set to issue debt to continue funding of the work their employees are doing to build a functional and profitable metaverse. The operation is set to occur this Thursday Aug.11 and currently investors are offering $30Bn to take advantage of this. The maturities of the bonds will be various ranging from 4 years to 30 years with a majority of the demand being aimed at the 30 year mark.
Meta has been slowly inching towards this offering since before releasing its earnings report in July. The company was able to recieve A1 and AA-stable ratings from Moody’s and S&P respectively. The move is set to create more cash flow for the company as the amount of free cash the company has currently is less than half that of the amount of last year. These bond sales will allow the company more breathing room to continue in the development of their metaverse offerings.
The restructuring of Facebook into Meta has cost Zuckerberg’s company a lot for research and development. The metaverse unit titled Reality Labs just recently had an earnings call that showed it reached a sales of more than $400 million but losses of $2.8Bn were also recorded during the second quarter of this year. The prediction is for the rest of the year Reality Labs is scheduled to lose just as much if not more. In order to circumvent some of this the VR headset the Quest2 has seen a $100 increase in price as well.