Top hyperscalers likely to have more AI-linked debt than now known, S&P Global warns
S&P says AI borrowing may hide more debt than disclosed, but it sees no immediate ratings change as investors push credit protection costs higher.
- On Monday, S&P Global estimated that the world's largest technology firms likely carry more AI-linked liabilities than currently disclosed, though Habib, S&P Global Head for Digital Infrastructure, sees no immediate need to change ratings.
- Companies raised an estimated $466 billion in 2026, up from $101 billion in 2025, funding AI infrastructure through 'interconnected financing structures' where hyperscalers guarantee projects for smaller providers.
- Credit default swap volumes averaged over $9 billion weekly in September, up from less than $2 billion in July. Jim Caron, chief investment officer of the portfolio solutions group at Morgan Stanley Investment Management, called the swaps a 'cheap hedge' for investors.
- Market unease centers on CoreWeave, whose bonds have slipped into distressed territory with five-year CDS trading at about 1,090 basis points. Nolan, executive director at S&P Global Market Intelligence, noted large intraday swings signal 'the uncertainty that is out there.'
- Top hyperscalers expect to spend more than $7 trillion on AI-related capital expenditures through 2030 with negative free cash flow projected until next year, prompting Dafforn, chief investment officer of London-based distressed debt specialist Polus Capital, to warn of 'very highly levered' borrowing.
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Behind the expansion of AI are accumulating trillions of dollars of liabilities and a complex network of financing that connects Silicon Valley to the financial system The post 3 trillion dollars of debt – Who will pay if the AI bubble bursts? appeared first on in.gr.
The global S&P risk classification agency estimates that the world's largest technology companies probably have more artificial intelligence-related liabilities than is currently known, although its main sector analyst sees no need to change any recommendations at the moment. The debt issued by AI infrastructure providers and the so-called "neocloud" companies, which sell computational capacity, such as CoreWeave, has reached increasingly critic…
S&P Global flags potentially hidden AI debt at hyperscalers as AI spending surges
S&P Global warned that hyperscalers could be carrying more AI related debt than currently visible through financing structures linked to data centres and smaller AI firms. Despite rising concerns around AI infrastructure debt, the agency saw no immediate need for rating changes, while flagging profitability and escalating investment as key risks.
Investors are seeking protection against the possibility that the big bet on artificial intelligence will be overturned. As companies borrow hundreds of billions of dollars for data centers and processors, the market is turning… FT: Market insures itself against the “burst” of the bubble – Alarm over the debt of the tech giants - ΙΝΑΦΤΕΜΟΠΟΡΙΚΙ
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