US EditionAlphabet Flags AI Risks as It Returns to Debt Market to Fund Expansion
Alphabet raised $20 billion in multi-currency bonds including a rare 100-year sterling note to fund $185 billion AI infrastructure spending, with demand exceeding $100 billion, Bloomberg reported.
- On Feb 9, Alphabet sold $20 billion in a seven-part bond offering, including a debut sterling tranche with a rare 100-year bond, to fund AI infrastructure.
- Industry-Wide demand for AI capacity, with hyperscalers including Microsoft, Amazon, Meta and Oracle set to spend at least $650 billion this year, drove firms to raise capital.
- Investor appetite pushed the sale from an initial $15 billion target to $20 billion amid heavy orders exceeding $100 billion, structured across seven tranches maturing to 2066.
- Market strategists say heavy AI-driven debt supply could pressure credit conditions and bond spreads, with Morgan Stanley projecting hyperscalers borrowing $400 billion this year and analysts expecting high-grade issuance to hit $2.25 trillion.
- Alphabet Inc.'s SEC filing last week warned AI could increase leasing liabilities, create excess capacity and threaten ads, while Karthik Nandyal said, `Much of the pricing we have done... need to be redone and reanalyzed as of January 2026`.
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