The AI financing boom is sweeping global debt markets! Issuance so far this year has reached a record high of US$6.61 trillion, with tech giants becoming the main borrowers.

Driven by the AI infrastructure investment boom, global bond issuance has hit a record high. According to data, since the start of this year, global financial institutions, corporations, and governments have raised a cumulative US$6.61 trillion through investment-grade and high-yield bond issuance, up 15% year-on-year, surpassing the full-year record set in 2025 with two months still left in the year. Among them, financing by cloud computing giants and data center developers has surged, driving a major shift in the borrower composition of the global bond market. Data shows that since the start of this year, cloud computing giants and data center developers have issued nearly US$368 billion in bonds, more than six times the scale of the same period last year. These companies contributed about one-third of this year's incremental global bond financing, not only exceeding all other non-financial sectors but also with new financing scale reaching twice that of new government sector financing. This shift highlights that AI infrastructure construction is becoming an important DRIVE for the global bond market. As tech giants invest enormous sums to expand data centers, procure chips, and deploy computing power, corporate financing demand is rising rapidly, and they are competing for capital with governments that need to fill fiscal deficits. Tech giants are rewriting the global bond market landscape: Amazon.com, Inc. ranks as the world's fourth-largest bond issuer The AI investment boom is reshaping the global bond market's long-standing financing landscape dominated by governments and financial institutions. Data shows that Amazon.com, Inc. (AMZN.US) has jumped to the world's fourth-largest bond issuer this year, behind only Germany, the EU, and Italy, ranking ahead of France and the UK. Among them, Germany and Italy's issuance scale also includes bond financing by government-supported agencies. Among corporate issuers, Amazon.com, Inc. has become the world's largest bond financing entity, followed by Alphabet Inc. Class C parent company Alphabet (GOOGL.US). Changes in the US market are equally pronounced. Since the start of this year, five of the top ten US corporate bond issuers have come from the tech sector. Meanwhile, financial institutions, which typically dominate corporate bond financing, have seen their share of issuance fall to the lowest level in at least a decade. John Servidea, global co-head of investment-grade financing at JPMorgan, said: "In just one year, the ranking of major issuers in the world's largest bond market has undergone a fundamental restructuring." He noted that AI has become a new long-term trend driving changes in the bond market. Behind this shift are unprecedented capital expenditure plans by tech companies. According to data tracked by Bloomberg Intelligence, a group of hyperscale cloud service providers and emerging cloud computing companies are expected to invest nearly US$4.5 trillion over the next three years to build and expand AI infrastructure. Such massive investment demand means tech companies will increasingly rely on the bond market for long-term funding, and global capital markets will need to absorb continuously growing financing supply. Massive financing raises market concerns: risk premiums on AI-related bonds rise However, the borrowing boom among tech giants has not been smooth sailing. Earlier this year, investors actively subscribed to bonds related to AI infrastructure construction. But as large bond issuance deals emerged one after another, a certain degree of supply absorption pressure began to appear in the market. At the same time, investor concerns are intensifying over whether the scale of AI investment is excessive and when related technologies will generate sufficient returns, prompting some investors to demand higher yields as risk compensation. In the US, some data center developers are offering investment-grade bond yields of up to 7.2% and high-yield bond yields of up to 10% to investors to obtain project financing. Among them, CoreWeave (CRWV.US), which provides computing services to tech companies such as Meta, has drawn market attention due to its continuously increasing debt burden. Earlier this month, speculative-grade bonds issued by CoreWeave suffered a significant selloff, with its credit risk indicators climbing sharply, triggering broader credit market turmoil. Market concerns about AI financing risks have also begun to spread to higher-rated tech companies. Hyperscale cloud service providers including Meta Platforms (META.US) and Oracle Corporation (ORCL.US) have also seen significantly higher costs of debt default insurance. This indicates that although investors are generally optimistic about the long-term development prospects of the AI industry, they have become more cautious about the continuously increasing capital expenditure and debt scale of related companies. High interest rate environment intensifies financing pressure: global competition for capital intensifies In addition to the surge in AI-related bond supply, the overall global financing environment is also facing new challenges. Persistently high oil prices, escalating geopolitical tensions in the Middle East, and the selloff in French sovereign bonds are all weighing on global credit market sentiment. Meanwhile, some US Treasury yields have recently risen to the highest level since 2002, further pushing up corporate investment and debt refinancing costs. As inflationary pressures persist, major global central banks are expected to maintain a more tightening monetary policy stance as they enter 2027. IMF Managing Director Kristalina Georgieva called this month for central banks to maintain a prudent hawkish policy bias to guard against inflation risks. Johanna Chua, head of emerging market economics research at Citi, said recently that central banks are realizing that the AI investment cycle is driving a structural increase in global capital demand and exerting upward pressure on neutral interest rates. If AI infrastructure construction continues to push up global funding demand, long-term interest rates may face greater upward pressure, keeping corporate and government financing costs elevated for an extended period. AI investment demand remains strong: Wall Street expects November bond issuance activity to heat up again Although the AI financing boom has brought short-term supply pressure to the bond market, some asset management institutions believe that the fundamentals of tech companies remain solid, and future capital expenditure demand is expected to continue supporting bond issuance. Neil Sun, portfolio manager at Royal Bank of Canada Global Asset Management, said that financing demand from hyperscale cloud service providers has indeed created a certain degree of short-term bond supply absorption pressure, but the overall outlook for AI capital expenditure remains strong. Sun noted that from a fundamental perspective, these companies' operating conditions remain sound, and market demand for computing power remains strong. He expects that even if global interest rates remain at elevated levels, the AI infrastructure investment boom will continue through 2027. Meanwhile, Wall Street expects further room for growth in bond issuance activity for the remainder of the year. Morgan Stanley expects that after significant volatility in bond issuance activity over the past two months, corporate financing demand may pick up noticeably again in November. Matteo Benedetto, co-head of investment-grade bond underwriting for EMEA at Morgan Stanley, said November is typically one of the busiest months of the year for corporate bond issuance. He noted that for companies that need to raise funds for M&A transactions or capital expenditure and cannot delay their financing plans, November remains an important window to lock in funding early. Overall, AI infrastructure construction is pushing the global bond market into a new financing cycle. Tech giants have not only become one of the most important borrowers in the corporate bond market, but their massive capital expenditure plans are also changing the global supply-demand landscape for capital. However, as bond issuance scale continues to expand, financing costs remain elevated, and investors scrutinize AI investment returns more strictly, whether the market can continue to absorb massive new debt will become an important factor affecting the trajectory of global credit markets.