California’s proposed Proposition 40 set the immediate backdrop. The one-time levy on billionaires’ assets prompted Zuckerberg to consider leaving the state, according to a Meta SEC filing. But a board special committee concluded it was “critically important” that he continue leading the company near its Silicon Valley headquarters and its Meta Superintelligence Labs.¹

The compromise was an eight-year commitment by Zuckerberg to remain in California, or another jurisdiction housing Meta’s corporate headquarters, absent unforeseen circumstances. In return, Meta devised a new non-voting share class that could give him as much as $20 billion in immediate liquidity to meet a tax bill without surrendering control. The proposed $150 billion stock class would not raise his ownership stake or net worth, the filing said; Meta’s stated aim was to keep him leading from California.¹

Then, in its third-quarter earnings release, Meta presented the same mechanism as a broader AI-financing strategy. The company said the non-voting shares, expected to begin trading in 2027, could fund AI investments, acquisitions and employee compensation. It argued that competing through the industry’s AI transformation requires investment on a “significant” scale, while CFO Susan Li said the shares would expand Meta’s funding options amid AI-driven business momentum.²

The sums explain the urgency. Meta expects annual capital expenditures of $135 billion to $145 billion and reported $34.91 billion in third-quarter spending, much of it tied to AI and the data-center buildout behind it.²

For the board, however, the financial case and the governance case are inseparable. Existing shareholders will receive the Class C shares in what effectively amounts to a two-for-one stock split, preserving Zuckerberg’s voting dominance while giving Meta more room to raise money. The company said the structure would sustain the “founder-led model” it credits with its success.³