AI-fuelled debt hits records as bankers stretch markets

TL;DR:

• Big technology firms are issuing bonds in currencies beyond the US dollar to fund AI spending, setting borrowing records in sterling, euros and yen.
• Amazon and Alphabet have raised $60bn in multiple currencies over the past year; hyperscaler capital spending is running near $725bn in 2026, almost double mid-2025 levels.
• Bankers are devising new structures backed by data-centre leases, even as investors question how much more debt the market can absorb.

The cost of building artificial intelligence is now reshaping global debt markets. With spending on chips, cloud infrastructure and data centres showing no sign of slowing, the large technology firms known as hyperscalers are borrowing in ever larger volumes — and bankers are inventing new ways to place the debt without saturating any single market.

Records in sterling, euros and yen

To widen the pool of buyers, Amazon and Alphabet have issued roughly $60bn of bonds in multiple currencies over the past year, setting records well beyond the US. Amazon raised €14.5bn ($16.56bn) in March in the largest-ever euro corporate bond deal, according to LSEG, while Alphabet set borrowing records in yen, Canadian dollars, Swiss francs and sterling, and sold the first 100-year bond from a technology company since 1997. The driver is scale: hyperscaler capital spending is estimated near $725bn this year, almost double mid-2025, and is rising faster than the cash these firms generate.

Bankers are also getting creative further down the risk curve, structuring deals around pre-agreed data-centre leases to give investors more visibility on future cash flows. One recent $810m note tied to an Amazon lease was nine times oversubscribed. For UK readers, the sterling records matter: London’s debt markets are absorbing a meaningful share of an American-led AI build-out, tying domestic investors to its returns.

The unease is that supply may outrun appetite. Bankers told Reuters AI borrowing could push investment-grade issuance above $2tn for the first time in 2026, and AI-related debt already approaches 15% of US investment-grade issuance, on Barclays’ figures. So far there are no signs of saturation — but recent equity sales hint the borrowing is far from over.

Looking forward

The open question is whether demand holds if AI returns disappoint. The same doubts that rattled tech stocks last week apply to bondholders: lease-backed structures look robust while data centres fill, but a slowdown would test investors who have lent against cash flows that depend on AI demand staying strong.