US cloud giants are starting a "global debt frenzy"! "AI bubble theory" on the verge of bankruptcy, computing power chain bull market logic being further reinforced.

With Google, Microsoft, Amazon and other cloud computing giants making every effort to quell the negative narrative of the "AI bubble" for the AI infrastructure frenzy, and striving to secure larger scale funding to accelerate the construction of multiple large AI data centers covering the global scale, coupled with the AI bond frenzy seemingly overwhelming Wall Street, actively driving Google's parent company Alphabet and other tech giants to turn to overseas credit markets. On Monday morning, as bankers were still putting the finishing touches on the issuance of Alphabet Inc.'s massive $17 billion corporate bonds, Wall Street was already buzzing with news: this US tech giant had already sold more debt on the foreign market. This time, it was a yen-denominated overseas bond issuance. Executives at Google's parent company Alphabet stayed awake all night, connecting with investors in the Tokyo market and promoting this transaction. The previous week, it issued euro and Canadian dollar-denominated bonds; a few months before that, it issued bonds denominated in US dollars, pounds sterling, and Swiss francs. Overall, by the time this yen bond issuance is completed, Alphabet may have raised close to $60 billion; this four-month global fundraising campaign is set to be one of the largest corporate debt frenzies in human history by the end of 2030. Whether it is the scale of financing itselffour times the total amount of bonds issued since Alphabet was founded 26 years agoor the global issuance path taken to complete the massive financing, this tech giant is at the forefront of a global fundraising competition. This fundraising race aims to raise funds for the unprecedented construction frenzy of artificial intelligence computational infrastructure, with an estimated cost of nearly $5 trillion by the end of 2030. Overall, the four major North American tech giants have sold over $300 billion in bonds to US investors to fund expenditures for a range of core equipment clusters related to AI computational infrastructure such as GPU/ASIC, HBM/DRAM/NAND, HDD, PCB/CCL/MLCC, optical modules, high-performance switches, copper cables, data center power equipment, liquid cooling equipment, etc. From dollars to yen, the AI debt frenzy is sweeping the globe! Tech giants' bond feast reshaping the credit market Wall Street bankers generally believe that US tech giants may follow Alphabet's lead and turn to overseas markets for funding, as they cannot rely solely on the US Wall Street financial market to support this unprecedented scale of ambitious AI endeavorsotherwise it could lead to a collapse in demand and a sharp rise in financing costs. Some signs of pressure have already begun to emerge. While global tech stocks continue to soar, driving benchmark stock indices higher, the bond yield of their tech companies lags behind the overall investment-grade bond market. "The reality is, they need a market depth that is too large, and therefore they must utilize every source of liquidity they can get," said Nanda Kamat, Global Project Finance Director at Royal Bank of Canada. Last week, Royal Bank of Canada helped lead Alphabet's $8.5 billion Canadian dollar (approximately $6.2 billion) bond issuance, the largest bond issuance in Canadian history. For the overseas bond market, these transactions may also bring disruptions. As mega cloud computing vendors seek financing globally, some analysts and investors warn that the upcoming wave of foreign currency bond issuances could crowd out local large traditional companies that have relied on relatively stable domestic financing channels for decades. "All of these AI-related bond issuances will make investors think about when bonds will become oversupplied," said Jim Fitzpatrick, Director of Investment Grade Bond Research at Allspring Global Investments. "No one wants to make a poorly performing trade." Alphabet's journey from zero to becoming a heavyweight issuer in the euro bond marketthis parent company of Google is closing in on the top of the world's second-largest credit bond market. Note: based on the major issuers in the Bloomberg Euro Non-Financial Investment Grade Index, according to stock codes from the estimated component list at the end of the month. From Tokyo to Zurich: Mega cloud computing vendors reshaping the global credit market landscape Alphabet's yen bond trading this week fully demonstrates the need for global liquidity flow. Bankers worked around the clock to push forward this unprecedented eight-part bond issuance. According to sources, the debt capital markets team and corporate finance team woke up as early as 3 a.m. Eastern Time on Monday to kick off the bond issuance in the Japanese market, starting a multi-day issuance process: the order book passed from Tokyo to London, then to New York, and back to Tokyo. This transaction could have been completed as early as Friday, marking Alphabet's fourth new currency bond issuance this year and its sixth overall bond issuance. Based on the final size, the company could surpass Anheuser-Busch InBev to become the creator of the largest scale global corporate debt frenzy over a semi-annual period. Alphabet has rapidly become a dominant player in multiple overseas debt markets. Its euro-denominated debt currently stands at around 22 billion ($26 billion), ranking eighth among non-financial issuers, surpassing major issuers such as BMW Group and Mercedes-Benz Group. By the end of this week, it could become the second largest corporate bond issuer in Japan. Earlier this week, American tech and e-commerce supergiants Amazon completed a Swiss franc bond issuance transaction, raising over $3 billion in its first issuance in this market, making it the sixth-largest issuer in that market. A representative from Alphabet declined to comment on the company's future financing plans; an Amazon spokesperson stated that the company regularly evaluates its operating plans and makes financing decisions accordingly. Matt Brill, Director of Investment Grade Credit for Invesco's North American market, said that tech companies are selling bonds wherever they can to help fund their massive capital expenditures in the field of artificial intelligence infrastructure. Bankers say that they are pushing tech company executives towards overseas market financing, in part to avoid a potentially panic-inducing oversupply in the US bond market that could lead to a collapse in demand and disrupt their valuation and bond issuance plans. According to data analysis from Barclays Bank, a Wall Street financial giant, excluding the financial industry, nearly 40% of the high-grade corporate bond issuances in the US this year came from tech companies, mostly from mega cloud computing vendors like Google and Amazon. If this ratio remains constant for the whole year, it will set a record high share. Historically, rapid growth in bond issuances like this tends to be relatively unfavorable for investors in the stock and bond markets. For example, global tech companies experienced another period of bond issuance growth from 2015 to 2017; according to Barclays strategists, during that time, high-grade tech bonds underperformed non-financial corporate bonds by about 0.16 percentage points. John Servidea, Co-Head of Global Investment Grade Financing at J.P. Morgan, said that diversifying currency portfolios helps maintain "scarce investment value in the US market." J.P. Morgan has helped lead several bond issuances for Alphabet and Amazon this year. The "game theory era" of AI financing: Whoever captures the overseas bond market first secures a long-term capital channel for the future However, the rapid increase in overseas issuance has raised a question: how much debt supply can these markets absorb? Historically, cross-border bond issuances across multiple currency markets have often been associated with one-time large-scale financing for major acquisitions. Now, as spending on AI computational infrastructure accelerates, tech companies seem prepared to repeatedly return to foreign currency markets for financing, creating what investors anticipate will be a continuous stream of new bond supply channels. "There is currently some uncertainty regarding the scale of upcoming supplies entering the market and how the market will further efficiently absorb these supplies in the future," said Rory Sandilands, Portfolio Manager at Aegon Asset Management. One major concern is that the surge in new bond issuances could begin to depress the prices of existing bonds traded in the market, especially if institutional investors start demanding larger yield concessions to absorb the supply. "A recurring concern in the market is whether there is another deal behind the corner," said Stuart Chilvers, Fund Manager at Rathbones. "If one company has just completed an issuance and another quickly enters the market, it's not surprising to see them widen the spread of existing deals." As shown in the figure, American mega cloud computing vendors are rising in the ranks of the Swiss franc bond marketAlphabet and Amazon have rapidly accumulated debt scales comparable to local traditional giants. Note: major non-financial issuers in the Swiss franc corporate bond index; based on estimated data at the end of May. Most seasoned market observers believe that, at least for now, global institutional investors have a very strong demand for more trades, especially as the cumulative weight of mega cloud computing vendors in major bond indices remains relatively small. For example, in the Bloomberg-tracked euro, pound sterling, and Swiss franc credit bond benchmark indices, the tech industry accounts for less than 5% of the market. Alphabet, Amazon, and other companies expanding their funding to more distant markets are only a matter of time; markets such as Australia, South Korea, and Taiwan, China are seen as potential sources of capital. Some bankers believe that taking early action has its advantages: companies that establish a dominant position in smaller, more segmented currency markets can lock in investor relationships and funding channels, while latecomers may find these markets already crowded by competitors. "There is a hint of game theory at play here," said Teddy Hodgson, Co-Head of Global Debt Capital Markets at Morgan Stanley. Morgan Stanley is helping lead Alphabet's yen-denominated bond transactions. He added, "None of these companies have exhausted the US credit market yet," but "if you only insist on using USD currency for financing, you may saturate that market; by that time, your peers have already established a lasting and diversified mega financing structure globally, minimizing the negative impact of the AI bubble panic and preventing the liquidity from drying up to support AI computational infrastructure expenditure." AI infrastructure frenzy enters the "global bond era"! Tech giants expand their financing landscape for computational power AI computational power chain bull market knows no bounds With Microsoft, Meta, Alphabet's Google, and Amazon raising their annual capital expenditures to nearly $800 billion, primarily for the construction of AI computational infrastructure, and as Taiwan Semiconductor Manufacturing Company acts as the primary manufacturer for almost all advanced AI chips and high-performance computing chips for data centers, its most advanced processes (including 3nm/2nm/future N2 and A16) are experiencing long-term full capacity or even overbooked situations. The situation of supply shortage makes its nearly irreplaceable manufacturing capacity a "bottleneck node" for the entire industry. On April 30, Microsoft, Google, and Amazon, the three cloud computing supergiants, all turned in impressive report cards on the same night, highlighting the super-expected explosion speed of their cloud computing businesses benefiting from the AI wave, prompting Wall Street to reevaluate the commercial returns of AI. The latest research report from Morgan Stanley's analyst team indicates that the combined capital expenditures of the five mega tech giants (Amazon, Google, Meta, Microsoft, Oracle) are expected to reach around $800 billion in 2026, and are expected to exceed $1.1 trillion in 2027, up from the previous forecast of $950 billion. The analysts at Morgan Stanley emphasized that the core logic behind these massive capital investments is to invest heavily in production capacity first, then generate commercial revenue and ROIC recovery based on the scale of AI computational resources; the skyrocketing backlog of orders in cloud computing is the most direct evidence that this logic is working. The super-expected explosion speed of their cloud computing businesses is leading Wall Street to reevaluate the commercial returns of AI. With these tech giants leading the wave of AI computational infrastructure construction following a path similar to early railroads, power grids, broadband, and cloud computingstarting with capital expenditures and then exploding with applicationsthe continued upswing trajectory in the AI computational industry and the global stock market bull market driven by the narrative of the AI computational power bull market may be far from over. These tech giants aim to convince more investors to believe that their massive investments in artificial intelligence will soon yield record returns. Therefore, for the AI computational power industry chain and the global stock market bull market driven by the narrative of the AI computational power bull market, their increasingly robust AI capital expenditures are a concrete positive factor that will continue to support the leaders in the AI computational power industry chain around AI GPU/ASIC, data center CPUs, HBM/NAND/HDD storage, 2.5D/3D advanced packaging, liquid cooling systems, optical interconnect supply chain, data center power chain, and so forth, as well as the trajectory of the global stock market bull market driven by the narrative of the AI computational power bull market. North American tech giants bypassing the single US bond market and turning to global credit markets, the construction of AI computational infrastructure is transitioning from a tech stock valuation story to a real capital expenditure cycle of the global credit market and cross-currency financing system, a dynamic that strikes at the "AI bubble narrative." If the leaders in AI tend to believe that the AI investment frenzy is in a bubble stage, these companies typically rely on stock price narratives, venture capital, or short-term market sentiment financing; but mega cloud providers like Alphabet, Amazon, and Meta are using euro, Canadian dollar, yen, Swiss franc, and US dollar denominated bonds to finance data centers, AI servers, power, networks, storage, and model training/inference infrastructure. This suggests that they view AI as a long-term asset on the balance sheet, rather than a short-term marketing concept.