(Reuters) -The world's largest technology companies are tapping debt markets, raising almost $100 billion through recent bond offerings, as they seek to bolster their artificial intelligence infrastructure.
This marks a shift for Silicon Valley firms that typically relied on cash to fund their investments.
Tech giants, including Amazon, Microsoft, Google, Oracle, and Meta, are set to nearly double last year's investment by spending $400 billion on data centers despite mounting fears of an AI bubble. Alphabet CEO Sundar Pichai has warned that no company will escape the fallout if the boom collapses.
Deutsche Bank estimates that global AI-related investment could reach $4 trillion by 2030, reflecting investors' insatiable appetite to commercialize a technology that surged in popularity three years after ChatGPT's debut.
AMAZON
On November 17, Amazon said it plans to raise $15 billion through its first U.S. dollar bond sale in three years.
The six-part offering drew $80 billion in demand, according to Bloomberg News.
Particulars Value
Debt outstanding $69.29 billion
Cash and cash $66.92 billion
equivalents
Next bond $1.25 billion due on
payment December 1 2025
ORACLE
In September, Oracle filed to raise about $18 billion in debt in a six-part offering to fund AI infrastructure, following billions already invested this year.
Particulars Value
Debt outstanding $101.25 billion
Cash and cash $10.45 billion
equivalents
Next bond $2.75 billion due on March
payment 25 2026
VERIZON
On November 12, Verizon filed to raise about $11 billion in the corporate bond market to help fund its $20 billion acquisition of Frontier Communications.
Particulars Value
Debt outstanding $139.62 billion
Cash and cash $7.71 billion
equivalents
Next bond $205.66 million due on March
payment 20, 2026
ALPHABET
On November 3, Google-parent Alphabet filed to raise $17.50 billion in debt in the U.S., and 6.5 billion euros ($7.49 billion) in Europe, for general corporate purposes, including the payment of outstanding debt, the company said.
Particulars Value
Debt $48.78 billion
outstanding
Cash balance $23.09 billion
Next bond $2 billion due on August
payment 15, 2026
META PLATFORMS
On October 30, Meta Platforms filed for its largest bond offering ever, up to $30 billion, to finance a costly AI infrastructure expansion.
The Facebook-parent has been navigating significant cost pressures from AI investments, with capital expenditure expected to be "notably larger" next year.
Meta recently secured a $27 billion private capital deal for its "Hyperion" data center and is aggressively hiring AI talent, contributing to increased compensation costs.
Particulars Value
Debt outstanding $59 billion
Cash balance $10.19 billion
Next bond $2.66 billion due on August
payment 15 2027
SOURCE: Data compiled by LSEG; SEC filings
($1 = 0.8679 euros)
(Reporting by Anhata Rooprai, Zaheer Kachwala and Johann M Cherian in Bengaluru; Editing by Leroy Leo)
