Meta stock: New Class C shares act as a 2-for-1 split as Q3 revenue tops estimates

Meta Platforms is creating a new class of stock. Alongside its third-quarter results on Wednesday, Oct. 21, the Facebook and Instagram parent said its board approved publicly listed, non-voting Class C common stock, to be handed to existing shareholders in a way Meta says should work like a two-for-one stock split. Shares rose about 2% in after-hours trading, SiliconANGLE reported, and “meta stock” passed 50,000 US searches on Google Trends.

This article is for information only and is not investment advice. Do your own research or talk to a licensed advisor before buying or selling any stock.

Meta’s new Class C stock, explained

According to Meta’s press release:

• The board declared a one-time stock dividend of one Class C share for every Class A and Class B share outstanding.
• The new class takes effect through an amended certificate of incorporation in Delaware with an effective date of Jan. 19, 2027. The record and payment dates for the dividend will be set later.
• After the payment date, Meta expects the Class A price to reflect a two-for-one split.
• The dividend won’t change any shareholder’s voting power. Class C shares carry no votes.
• Class A keeps trading on Nasdaq, and Meta intends to list Class C on Nasdaq too.

Is it a Meta stock split?

In effect, yes. Meta itself says the Class A price should reflect a two-for-one split once the Class C dividend is paid. The difference from a plain split is that the new shares are non-voting, so holders end up with two kinds of stock.

Why Meta is doing it

A special committee of independent directors recommended the move, Meta said. Its reasons include giving Meta shares it can use for capital raising, employee pay and possible acquisitions amid the cost of the AI race, and keeping founder and CEO Mark Zuckerberg in control. Reuters noted the shares could let Meta fund deals and attract talent without diluting Zuckerberg’s voting control.

SiliconANGLE, citing an information statement Meta filed Wednesday, reported that Zuckerberg holds about 60.6% of the vote on a 13.4% economic interest. Under a new “Founder Alignment Agreement,” only 20% of the Class C shares he receives can be sold freely, and the rest unlock at 2.5% a quarter while he stays a full-time executive or executive chair, SiliconANGLE said. The agreement also commits him to live in California, or wherever Meta’s headquarters is, for eight years. SiliconANGLE tied that to Proposition 40, a California wealth tax measure on the Nov. 3 ballot.

Meta earnings: Q3 2026 numbers

From Meta’s release:

Metric	Q3 2026	Q3 2025
Revenue	$64.60B (+26%)	$51.24B
Operating margin	20%	40%
Net income	$9.86B	$2.71B
Diluted EPS	$3.83	$1.05
Daily active people (Sept.)	3.64B (+3%)	—

Analysts expected about $63.3 billion to $63.37 billion in revenue, according to SiliconANGLE and Reuters (LSEG data), and $3.56 in EPS, per SiliconANGLE.

The quarter included a $9.89 billion charge for Meta’s August agreement with 52 state attorneys general over teen mental health and social media, which provides for payments of up to about $18.59 billion. Excluding it, diluted EPS would have been $7.40, Meta said.

Capital spending was $34.91 billion, above the $32.79 billion in operating cash flow, leaving free cash flow at negative $2.12 billion. Headcount was 66,775, down 15% from a year earlier.

Outlook and the earnings call

• Q4 revenue: $73 billion to $76 billion. SiliconANGLE said analysts had forecast $73.65 billion.
• 2026 capital expenditures: $135 billion to $145 billion, narrowed from $130 billion to $145 billion.
• 2026 total expenses: raised to $175 billion to $179 billion to include the legal charge.
• Reality Labs: losses of $18 billion to $19 billion this year, narrowing to about $15 billion next year.
• 2027: no full-year revenue outlook, though Meta said it expects strong revenue growth to continue.

On the call, Zuckerberg said more than 10 million people in the US and Canada set up accounts for Muse, Meta’s AI agent, in about six weeks, SiliconANGLE reported. CFO Susan Li said expanding its user base “will require significant investment.”

Legal backdrop

Reuters also noted that a New Mexico judge ordered a $25 billion penalty against Meta earlier Wednesday, after a jury found it misled residents in a case related to Cambridge Analytica. Meta’s release said it continues to face youth-related scrutiny and has several youth-related trials scheduled in the US in the coming months.

FAQ

When does Meta’s Class C stock start? The certificate change is set to take effect Jan. 19, 2027. The dividend record and payment dates haven’t been set.

Do I need to do anything? Meta says Class C shares will be issued as a dividend to existing Class A and B holders. Check with your broker for details.

Will Class C shares vote? No. They are non-voting.