Zuckerberg threatened to leave California over wealth tax plan

Meta Platforms introduced a new Class C non-voting stock, distributing one share per Class A and B share held. Shares rose 2.17% after hours on Q3 revenue beat. Q3 free cash flow was negative $2.12 billion, with capital spending at $34.91 billion. Mark Zuckerberg retains voting control, with restrictions on selling Class C shares. Meta expects another $49-59 billion in Q4 capital spending.

Meta's Q3 revenue rose 26% to $64.6B, beating estimates, and shares climbed 4%. Advertising revenue grew 22%, with higher ad prices and volumes. The company plans non-voting Class C shares by 2027 to fund AI, preserving Zuckerberg's control. Muse AI agent has 10M users, with monetization expected in 2027. Q4 revenue forecast is $73B-$76B, above analyst estimates.

Meta Platforms was ordered by a New Mexico judge to pay $25 billion for misleading consumers about data privacy, following a case related to the Cambridge Analytica scandal. The penalty, one of the largest in US history, is being appealed by Meta, which argues the ruling makes it difficult to operate in the state. New Mexico's attorney general called the penalty a historic step in holding Big Tech accountable.

Meta reached an agreement with CEO Mark Zuckerberg to stay in California for 8 years, avoiding potential tax-related share sales. The deal includes a new Class C share structure, allowing Zuckerberg to sell portions of his shares while maintaining voting control. Meta cited Zuckerberg's leadership as crucial amid AI competition. California's Proposition 40 could impose a 5% tax on assets over $1 billion, potentially affecting Zuckerberg's net worth.

A New Mexico judge ordered Meta to pay $25 billion for misleading Facebook users about data access, reducing the penalty from a potential $219 billion. The ruling stems from 43 million violations of state consumer protection law. Meta plans to appeal, arguing the state's approach makes it difficult to operate there.

New Mexico has sued Meta Platforms twice, with a 2026 jury finding Meta exposed children to predators and ordering $375M in penalties. In a separate case, a 2026 jury found 43M violations of state law, with a judge ordering Meta to pay $25B. Meta plans to appeal both rulings.