AI buildout pushes Microsoft, Meta and Google into bond markets

America's largest technology firms plan to spend over $380bn on data-centre and AI infrastructure in 2026 alone. Microsoft has issued $65bn in investment-grade bonds over the past six months, Meta priced its first 30-year tranche in April, and Alphabet is preparing a €25bn euro-bond programme to fund European capacity expansion.

Bank of America strategists note this is the first time in over a decade that hyperscaler balance sheets show rising leverage after years of cash-rich, low-debt profiles. Equity investors, traditionally focused on revenue growth and operating margins, are now scrutinising U.S. 10-year Treasury yields and investment-grade corporate spreads as direct inputs to the cost of funding the AI build.

Citi's research desk calculates that even Microsoft's $80bn annual free-cash-flow run-rate no longer covers current capex commitments, projecting an additional $100bn of borrowings through end-2027. Moody's says it is watching the cumulative Big Tech credit picture closely, though the flat yield curve is keeping near-term financing costs contained even as issuance volumes climb.