Hyperscalers Look Beyond Cash

The past few months have seen massive offerings of AI-related debt—roughly $93 billion or more than 5% of investment grade debt issuance this year—close to triple the sector’s average annual issuance of $32 billion between 2015 and 2024, according to Bank of America. The borrowers are a “who’s who” of hyperscalers, such as Meta, Alphabet and Oracle, looking to build out data centers while seeking to secure captive energy sources to keep them running. According to Morgan Stanley, we could see an additional $3 trillion in AI-related capital expenditures over the next three years, potentially accelerating already aggressive issuance levels.

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