Google is planning to issue rare 100-year bonds to feul AI expansion
Alphabet, the parent company of Google, is considering issuing a rare 100-year bond soon, according to reports. This comes just after the company issued $20 billion of bonds on Monday, adding momentum to a surge in debt financing by artificial intelligence companies that analysts say could drive corporate bond issuance to a record this year.
The company is also preparing a debut offering in sterling, which could include a rare 100-year bond, the FT reported on Monday, citing people familiar with the discussions. A 100-year bond is very rare for companies and almost unheard of in the tech world. Historically, only a small number of very stable companies have issued such bonds, including the Walt Disney Company, Coca-Cola, and IBM. The main reason is that it’s impossible to know whether a company will still be operating 100 years in the future.
The recent Alphabet transaction comes shortly after Oracle disclosed a $25 billion bond sale in a securities filing on February 2. AI-focused companies have been sharply increasing borrowing alongside rising capital spending as they compete to expand data center capacity and secure advanced processors.
Last year, the five largest AI hyperscalers, Amazon, Google, Meta, Microsoft, and Oracle, issued a combined $121 billion in corporate bonds, according to a January report from BofA Securities.
Oracle raised $18 billion through bond sales in September. That was followed in October by Meta’s $30 billion offering, the largest-ever non-merger-related high-grade bond sale by a single issuer.
Morgan Stanley analysts estimate that hyperscalers alone could issue $400 billion in bonds this year to fund projected investment, and they expect AI-driven issuance to contribute up to $2.3 trillion to total bond supply.
The rapid acceleration in AI-related spending has already rippled through other areas of the market, including a recent selloff in software stocks following the release of Anthropic’s Claude model.
