Rising debt issuance and wider credit spreads add to scrutiny of how aggressively major technology companies are financing AI infrastructure, even as earlier lease commitments show much of that spending was already pre-committed.
Microsoft, Meta, Oracle Cloud, Amazon and Alphabet have already locked in roughly $1.09 trillion of future lease payments tied mainly to AI-supporting data centers, and investors are now examining the financing strain behind that buildout more closely. Reuters previously reported that those lease commitments far exceed the five companies' recognized lease liabilities because accounting rules keep signed but not yet commenced leases off the balance sheet until they begin. New reporting suggests the market is becoming more cautious as major technology companies lean more heavily on debt to fund AI infrastructure. Amazon, CoreWeave, Google, Meta, Microsoft and Oracle are expected to spend $785 billion on infrastructure this year, according to Moody’s Ratings, with that total projected to approach $1 trillion in 2027. Moody’s said those companies have taken on about $460 billion in debt to support AI spending, warning that the shift could threaten credit quality even though credit metrics remain strong for most issuers. Data from LSEG showed bond issuance by hyperscalers rose from $16.7 billion in 2024 to $193 billion so far in 2026. S&P Global analysts said markets are showing signs of fatigue as bond spreads widen and the cost of insuring debt rises. Oracle’s five-year credit default swaps reached 218 basis points last Wednesday, while swaps on Amazon, Microsoft, Alphabet, Meta, Nvidia, CoreWeave and SpaceX also moved higher. The pressure comes as investors question whether AI spending will generate the expected returns: Alphabet reported negative free cash flow after raising its annual spending forecast by $15 billion, Meta said free cash flow fell to about $780 million after lifting the lower end of its 2026 spending forecast by $5 billion, while Microsoft said spending would hold steady this year and indicated free cash flow would remain positive through fiscal 2027. Amazon announced another $20 billion in capital expenditures alongside negative cash flow but its stock rose on stronger-than-expected revenue.