Meta Reportedly Issues $10 Billion in Bonds to Invest in Its Metaverse Products and Other Initiatives – Metaverse Bitcoin News

Social media company Meta is reportedly planning to issue its first tranche of bonds to finance new investments and operations. The company will sell $10 billion of debt to maintain healthy cash flow and fund buybacks, according to a statement from two people familiar with the matter.

Meta issues bonds to finance new investments

Meta is one of the first companies to make the Metaverse part of its primary business model, and it will issue debt to continue funding some of its operations and maintain healthy free cash flow.according to Report The company will issue $10 billion in bonds as part of the tech giant’s first such offering, according to people familiar with the matter.

The action, which was scheduled to take place on Thursday, was well received, with investors offering $30 billion to capitalize on the move. The bonds will have different maturities, ranging from five to 40 years, with most of the demand going to the latter.

According to sources, the product has been in the works for the past two months, and Meta decided to launch it after its latest earnings report in July. The company has received satisfactory ratings from various agencies, with an “A1” rating from Moody’s and an “AA-” rating and a “stable” outlook from Standard & Poor’s.

expensive metaverse move

The bond offering was tied to the contraction in free cash flow the company experienced last year. Meta has free cash flow of $4.45 billion, compared with the company’s free cash flow of $8.51 billion a year ago. The goal of the bond offering is to give the company more breathing room to continue funding some of its businesses, including its Metaverse plans, the sources said.

Meta’s metaverse push has the company spending a lot of money on research and development.On its latest earnings call, the company report Its Metaverse unit, Reality Labs, has surpassed $400 million in sales but posted a loss of more than $2.8 billion in the second quarter of 2022. Forecasts weren’t good either, with the company acknowledging that Reality Labs would continue to lose money in the third quarter.

Meta has also taken some steps in sales, improve The price of its flagship VR headset, the Quest 2, is reduced by $100 “to continue investing to drive the long-term growth of the VR industry.”

What do you think of Meta’s $10 billion bond offering?Let us know in the comments section below

Sergio Goshenko

Sergio is a cryptocurrency journalist in Venezuela. He describes himself as late to the game, entering the crypto space when prices rose in December 2017. With a background in computer engineering, living in Venezuela, and being affected by the cryptocurrency craze on a social level, he offers a different perspective on the success of cryptocurrencies and how it can help the unbanked and underserved.

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