Compiled from reports by Reuters, The Next Web and Startup Fortune. See the original articles linked below.
S&P Global Ratings changed its outlook on Meta Platforms from stable to negative on Friday, October 30, 2026, according to Reuters. The agency cited uncertainty over the company's capital spending and its free operating cash flow. Startup Fortune noted that Meta's AA- rating itself was left in place, which makes the move a warning rather than a downgrade.
Spending and cash flow
Reuters reported that Meta has forecast capital expenditure of $135 billion to $145 billion for 2026. The company also recorded a free cash flow deficit of $2.12 billion in the third quarter, and Reuters said it plans to sell $97.5 billion of stock to help pay for its AI buildout. The Next Web, by contrast, wrote that Meta had begun a $35 billion share sale, and it put the company's commitments at about $825 billion.
Reuters said S&P forecasts free operating cash flow deficits of $39 billion in 2026 and $71 billion in 2027, and that negative cash flow could continue beyond 2028, with that year's shortfall funded entirely by debt. Startup Fortune gave the 2026 deficit as roughly $22 billion instead, alongside the same $71 billion figure for 2027. It added that S&P expects capital spending above $225 billion in 2027 and $252 billion in 2028.
Monetization and leverage
The Next Web reported that S&P regards Meta's ability to earn money from its AI investments as more limited than that of Amazon, Microsoft and Google, because Meta has no cloud business that rents out computing power. Startup Fortune made the same point. Reuters said S&P considers it unclear when new revenue will exceed rising costs, and that the agency is less sure Meta will cut back spending as it had previously expected.
On leverage, Reuters said S&P expects the ratio to rise above 1.0x as early as 2027, which is the threshold for the AA- rating. The Next Web said the figure was about 0.1x last year. Reuters attributed the earlier low level largely to Meta leasing data-center capacity instead of issuing debt. According to Startup Fortune, S&P said it could lower the rating if adjusted leverage stays above 1.0x on a sustained basis and free cash flow remains negative past 2028.
Meta's response
Reuters reported that a Meta spokesperson disagreed with S&P's view of the company's AI monetization and said Meta sees significant product and business opportunities ahead. The Next Web named the spokesperson as Kamran Mumtaz.
Wider context
Startup Fortune reported that Meta sold $30 billion of bonds on the same day, with orders above $125 billion, and that its five-year credit default swaps rose to about 115 basis points. It linked the outlook change to a broader selloff in large technology stocks. The Next Web said the Nasdaq 100 fell 3.5% during the week after disappointing technology earnings, and that Big Tech has committed more than $3 trillion to AI infrastructure.
Reuters added that S&P also lowered its outlook on Broadcom to stable from positive, and that it cut Oracle's rating earlier this year to BBB-, one notch above junk. The Next Web likewise mentioned the Oracle downgrade, which it connected to data center costs.
Sources
- S&P Global revises Meta's outlook to 'negative' on AI spending, cash flow concerns (Reuters, 2026-10-30)
- S&P turns negative on Meta as AI spending eats into its cash (The Next Web, 2026-10-30)
- S&P Global cuts Meta's credit outlook to negative over AI spending (Startup Fortune, 2026-10-31)
This article was compiled with AI assistance from the reports listed above and reviewed by GMA before publishing.