Big Tech's AI Debt Wave Threatens Global Credit Markets Amid Massive Infrastructure Push

A new Bloomberg analysis reveals that the "AI trade" is profoundly reshaping corporate debt markets, mirroring its significant impact on equities. This trend sees major technology companies embarking on an unprecedented borrowing spree to fund their ambitious artificial intelligence infrastructure projects.

webull.com reported, Alphabet, Meta, Amazon, Microsoft, and Oracle alone are projected to require approximately $570 billion in capital expenditure for AI infrastructure. This massive demand is compelling these tech giants to issue record volumes of bonds, a notable shift from their historical reliance on cash reserves.

Investors are expressing growing concerns that this influx of Big Tech AI bond sales could overwhelm market demand. This situation risks crowding out other high-grade issuers, particularly if the current pace of issuance continues unabated into 2026.

techstartups.com noted, The shift towards debt financing marks a new era for Silicon Valley, which traditionally funded investments internally. Reuters reported in November 2025 that this aggressive turn to debt markets is driven by the urgent race to build AI-ready data centers.

Credit and Collection News noted in November 2025 that AI-related capital expenditure is set to climb steeply, projected to reach $400 billion in 2025 and $600 billion by 2027. This underscores the immense financial commitment required for AI development.

bloombergtax.com reported, Bloomberg Law reported in September 2025 that tech companies have already raised about $157 billion in US public bond markets this year, a 70% increase from the same period last year. Oracle, for instance, led with nearly $26 billion in bond issuance.

This surge in borrowing has led to jitters among bondholders, who are beginning to question the sustainability of such rapid debt accumulation. The European Business Magazine highlighted in November 2025 that investors are reassessing credit quality amid the scale and speed of AI investment.

• webull.com noted, Unprecedented Capital Demands for AI Infrastructure: The drive to dominate artificial intelligence has transformed AI into an industrial endeavor, demanding capital on a scale previously associated with energy companies or national infrastructure projects, as reported by the European Business Magazine in November 2025. McKinsey research from April 2025 projects that data centers equipped for AI processing could require $5.2 trillion in capital expenditures by 2030 globally.

• Record Bond Issuance and Market Absorption Concerns: Major tech firms, including Alphabet, Meta, Oracle, and Amazon, have collectively issued nearly $90 billion in public bonds since September 2025 alone, Reuters calculated in November 2025. This rapid pace of issuance has led to questions about the bond market's capacity to absorb such a surge in supply without demanding higher interest premiums, according to Credit and Collection News.

• techstartups.com reported, Shifting Funding Paradigms and Investor Scrutiny: Historically, Big Tech companies largely relied on their substantial cash reserves to fund capital expenditures. However, Webull noted in November 2025 that the current AI boom marks a significant departure, with companies increasingly turning to debt markets. This shift is prompting investors to scrutinize whether AI investments will yield sufficient profits to justify the escalating borrowing levels.

• Potential for Crowding Out and Market Strain: The sheer volume of AI-related bond sales is raising fears of a "crowding out" effect, where the demand from tech giants could make it harder and more expensive for other high-grade corporate issuers to access capital. J.P. Morgan analysts estimated in November 2025 that AI data center bond sales could reach $1.5 trillion over the next five years, potentially representing over 20% of the investment-grade bond market by 2030.

• bloombergtax.com noted, Impact on Credit Ratings and Valuations: The aggressive pursuit of AI infrastructure through debt is beginning to affect credit profiles. S&P Global Ratings revised Oracle's outlook to "negative" in November 2025, citing its strained credit profile due to anticipated capital expenditure and debt issuance for AI growth, as reported by The Economic Times. This trend also contributes to investor unease regarding technology stock valuations.

• The "AI Bubble" Debate and Profitability Questions: Concerns about an "AI bubble" are intensifying, with some analysts questioning the long-term profitability of these massive investments. The Washington Post reported in November 2025 that JPMorgan estimates an additional $650 billion in annual revenue is needed for industry-wide AI investments through 2030 to achieve a modest 10% return, highlighting the significant financial hurdle.

• webull.com reported, Energy Demands and Infrastructure Challenges: The construction of vast AI data centers requires unprecedented amounts of power. Discovery Alert highlighted in November 2025 that individual AI clusters can demand up to 100 megawatts, equivalent to powering 80,000 residential homes. This immense energy requirement adds another layer of complexity and cost to the AI infrastructure buildout.

• Investor Caution Amidst High Demand: Despite the strong demand for tech bonds, investors are becoming more discerning. Man Group noted in November 2025 that while equity markets have soared on AI enthusiasm, bond investors are taking a more circumspect view, focusing on downside risks and demanding higher premiums for new issuances.