Meta creates non-voting Class C shares to fund its AI push as Muse tops 10 million users

What Meta announced

Meta is creating a new class of publicly listed, non-voting stock to help pay for its AI build-out. The company announced the plan alongside its third-quarter 2026 results on 21 October 2026, saying the board approved a Class C common stock with an effective date of 19 January 2027. Existing holders of Class A and Class B shares will receive one Class C share for each share they own.

On the same evening, Mark Zuckerberg gave investors the first hard numbers on Muse, the personal agent Meta launched in September. He told analysts that more than 10 million people in the US and Canada have set up Muse agents in roughly a month and a half, and that about a quarter of them use it on any given day.

The two announcements belong together. Meta's own release argues that "the scale of investment required to compete, sustain growth, expand infrastructure, and pursue new strategic initiatives amidst the AI transformation" is significant, and Muse is the product Meta is now pointing to as proof that the spending on models such as Muse Wonder and clusters like Prometheus in Ohio is turning into something people use.

How the Class C shares will work

Meta says it will file an amended and restated certificate of incorporation in Delaware to create the Class C stock. The board has declared a one-time stock dividend of one Class C share per outstanding Class A and Class B share, to be paid after the new certificate takes effect. The record and payment dates have not been set yet.

Class C shares carry no voting rights. Meta says the dividend will not change any shareholder's voting power, and that after it is paid the market price of the Class A stock should reflect the effect of a two-for-one split. Class A stays on Nasdaq, and Meta intends to list the Class C shares there as well.

The certificate change has already been approved by shareholder written consent, so no shareholder vote is scheduled. Meta has also signed a Founder Alignment Agreement with him covering his sales of the Class C shares he receives, his service at the company, and conditions for any future Class C stock dividends. A special committee of independent directors recommended the plan, advised by Moelis & Company, with Morgan Stanley advising Meta.

Why Meta says it needs them

Meta lists three reasons in its release. The first is money: the Class C stock is meant for capital raising, employee compensation, potential acquisitions and other corporate purposes, giving Meta "the ability to finance its growth" against what it calls fierce domestic and international competition. Because the new shares carry no votes, Meta can issue them without diluting Zuckerberg's control.

The second and third reasons are about governance. The committee says it wants Meta to keep its emphasis on long-term growth and that Zuckerberg is best suited to lead the company "into its next era." Chief financial officer Susan Li told analysts the stock will "expand our funding tools and give us flexibility to invest behind the unprecedented momentum we're seeing," according to The Verge.

There is also a personal angle in the filing. CNBC reported that Meta disclosed Zuckerberg could face a multi-billion-dollar tax bill if California's Proposition 40 wealth tax becomes law, and that he told the special committee he was evaluating moving his primary residence outside the state. Meta presents the Class C structure as a way to keep founder control stable whatever happens to his share sales.

Muse passes 10 million people

Zuckerberg used the call to argue that Muse has found product-market fit. Beyond the 10 million figure and the roughly 25 percent daily use rate, he said that for the earliest adopters "the longer that they use Muse, the better that retention seems to get," as quoted by CNBC. The 10 million figure matches a Sensor Tower estimate from earlier in the week, according to TechCrunch.

Shopping is the biggest use. Zuckerberg said more than a quarter of people using Muse are shopping through it, with an average purchase size above $200. Muse connects to bank accounts through Plaid, and he said Plaid told Meta it had not seen activity like this on its connector from any other service. Other popular uses include personal productivity tasks such as connecting Muse to email and calendars.

Zuckerberg pointed to that as a sign users trust Muse's security setup, including a feature called Muse Secure VM, and said a forthcoming Muse Confidential VM will keep even Meta from seeing users' content. That claim will get scrutiny: researchers recently showed that Muse share links could be found through public DNS records, and Meta paused the sharing feature.

How Meta plans to make Muse pay

Meta's plan is to keep Muse free for most people and take a share of the commerce that runs through it. CNBC notes Meta already sells $20 and $100 monthly plans for power users who want its newest model, and charges developers $50 or $200 a month for Muse Wonder Full through its coding agent. Retailers are getting ready for that kind of traffic: Walmart opened its stores to customers' own AI agents on the same day.

Zuckerberg told analysts Meta expects Muse to eventually bring in more revenue per user than its family of apps does today, a figure he put at several hundred dollars a year, and that it will be profitable at scale. "In the near term, Muse is very compute-intensive to run, but we expect to improve its cost efficiency by more than 10x in the next year," he said, according to TechCrunch. Meta is building capacity to serve more than a billion people over the next few years.

He also previewed a "Muse network" in which people's agents work with the agents of friends, family and businesses, so buying something means "talking to their agent" rather than visiting a website. The competition is moving the same way, with Anthropic opening Claude Duet the same day and OpenAI pushing its Dots agents.

The quarter in numbers

Meta reported third-quarter revenue of $64.60 billion, up 26 percent from a year earlier. Costs and expenses rose 68 percent to $51.61 billion, including a $9.89 billion charge for its agreement with 52 state attorneys general over teen mental health, which provides for payments of up to about $18.59 billion. Operating income fell 37 percent to $12.99 billion; without the charge it would have been $22.88 billion. Net income was $9.86 billion and diluted earnings per share $3.83, or $7.40 excluding the charge.

Capital expenditures, including finance lease payments, were $34.91 billion in the quarter, and free cash flow was negative $2.12 billion. Meta ended September with $82.45 billion in cash and marketable securities and 66,775 employees, 15 percent fewer than a year earlier. Daily active people across its apps averaged 3.64 billion.

For the full year, Meta narrowed its capital expenditure outlook to $135 billion to $145 billion, from $130 billion to $145 billion, and expects fourth-quarter revenue of $73 billion to $76 billion. It said it will keep investing aggressively in 2027. Reality Labs losses are now expected at $18 billion to $19 billion for 2026 and about $15 billion next year as money shifts toward AI. Some early reports gave different Reality Labs figures; the numbers here are from Meta's release. CNBC said the stock rose about 3 percent after hours.

What to watch and what is unclear

Several details are still missing. Meta has not set the record and payment dates for the Class C dividend, said how much stock it might sell or when, or published the full Founder Alignment Agreement; it says more will appear in an 8-K and an information statement filed with the SEC. How investors and index providers treat a non-voting class will shape how useful the shares are for raising money.

The Muse figures are Meta's own and were given on an earnings call, not in an audited report. "Set up" a Muse agent is not the same as active use, the 25 percent daily rate was not broken down by country or cohort, and the $200 average purchase comes without totals or return rates. Analysts quoted by CNBC also urged patience on how quickly agent commerce will matter. AI Lookout has not reviewed the SEC filings, which were not yet available when this was written, and has not independently checked the Muse numbers. Meta's open-weight Muse Spark Open shows the company is also courting developers, but Muse itself remains the bet investors will judge.