Large technology companies are significantly increasing their borrowing in bond markets to finance the extensive infrastructure needed for artificial intelligence. This includes the development of hyperscale data centers and other AI-related investments, with combined capital expenditures for Amazon, Alphabet, Meta, Microsoft, and Oracle potentially reaching $725 billion in 2026. This scale of investment necessitates external financing beyond their operating cash flows, leading to a surge in corporate bond issuances.
From 2020 to 2024, US debt issuance from Amazon, Alphabet, Meta, and Oracle totaled $141 billion, averaging $28 billion annually. However, in 2025, hyperscaler debt in the US jumped to $93 billion, and the pace has accelerated dramatically in 2026. So far this year, there has been a 50% increase in issuance from 2025, with $107 billion in US dollar debt and an additional $62 billion in other currencies. Vanguard estimates that hyperscalers have only raised over half the funding they need this year, with total AI-related investments possibly reaching $800 billion.
This borrowing spree is reshaping the corporate bond market. Tech firms now account for 18% of total US corporate debt issuance in 2026 and hold a record 10.3% share of the US investment-grade bond market. NVIDIA, for instance, recently issued $25 billion in corporate debt, which was more than three times oversubscribed. This trend of tech giants tapping credit markets reflects a broader shift towards leverage to fund the AI investment cycle, rather than solely relying on operating cash flow. While demonstrating confidence in long-term AI demand, it also raises concerns about increased systemic sensitivity if AI-driven revenues do not meet expectations.
The global bond market is also seeing significant activity, with companies diversifying funding outside the US dollar. Non-dollar issuance has doubled this year, now comprising 30% of total hyperscaler bond funding, up from 15% previously. Notable international deals include Amazon's €14.5 billion ($16.88 billion) euro corporate bond deal, the largest ever, and record-setting issuances from Alphabet in yen, Canadian dollars, Swiss francs, and sterling. Morgan Stanley anticipates around €50 billion in hyperscaler euro borrowing in 2026, potentially making US companies the largest source of corporate debt in the euro zone. Pimco's chief investment officer, Dan Ivascyn, expressed caution, noting that technology comes with a riskier debt profile and that the pace of financial engineering is accelerating, including practices like rating agency arbitrage.
