Alphabet issues $20 billion in bonds to finance artificial intelligence spending

Alphabet has issued bonds worth $20 billion through a seven-part issuance structure, with maturities extending to 2066, leveraging the bond market to fund its surging artificial intelligence infrastructure spending.

The disclosure on Tuesday highlights that major tech companies are increasingly turning to credit financing, moving away from years of relying on robust cash flows to fund investments in new technologies.

This shift has raised concerns among investors, as the returns from the hundreds of billions of dollars invested in artificial intelligence by U.S. tech giants remain quite limited at present.

Total capital expenditures for these companies are expected to reach at least $630 billion this year, with most of the funds going toward data centers and the AI chips powering them.

Previously, Oracle disclosed in a securities filing on February 2 that it had issued $25 billion in notes.

Last week, Alphabet stated that it would invest up to $185 billion in related expenditures this year.

Editor: Guo Mingyu