Meta Approves Non-Voting Class C Shares to Preserve Zuckerberg Control, Fund Growth

Meta Platforms (META) said its board approved a charter amendment creating non-voting Class C shares, a structure designed to widen capital-raising, employee-compensation and acquisition options without diluting CEO Mark Zuckerberg's voting control. The board approved the change on Wednesday, Oct. 21, alongside third-quarter results, with the revised certificate of incorporation set to take effect Tuesday, Jan. 19, 2027. Existing holders will receive one Class C share for each Class A or Class B share, and Meta expects its Class A price to reflect a two-for-one split after the distribution. A Founder Alignment Agreement would grant Zuckerberg Class C shares that could cover a potential multibillion-dollar tax liability tied to California's proposed wealth tax, Proposition 40, in exchange for an eight-year commitment to reside in California or where Meta is headquartered. Meta reported Q3 revenue of $64.60 billion, up 26.1% year over year and above the $63.35 billion consensus. A $9.89 billion legal charge tied to a state attorneys general agreement pushed operating income down 36.8% to $13 billion and operating margin to 20% from 40%. Net income rose 264% to $9.9 billion, or $3.83 per share, missing the $5.46 estimate. Meta guided Q4 revenue to $73 billion-$76 billion.