AI-related debt sells off sharply as Amazon seeks another $25 billion
Bonds financing the vast artificial-intelligence buildout were hit hard by selling on Tuesday, as Amazon set out to borrow another $25 billion in new debt. The sell-off reflected investor unease over the scale of borrowing across the AI sector.
Bonds financing the artificial-intelligence buildout came under sharp selling pressure on Tuesday. Amazon's plan to borrow another $25 billion through a new debt sale drew attention to the scale of borrowing that technology firms are taking on to fund data centres and chips.
The sell-off reflected investors' increasingly cautious stance on the returns from AI spending. Analysts said a run of large bond issues has created supply pressure in credit markets, pushing up the risk premiums investors demand.
Amazon's move was the latest in an accelerating wave of borrowing across the sector. Investors will watch closely whether AI investments translate into revenue and free cash flow, and how appetite for new debt holds up in the months ahead.
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