Amazon.com Inc. is raising at least $25 billion through a US dollar bond sale to fund its artificial intelligence infrastructure and buildout. This represents the company's largest bond sale of the year and serves as a clear sign of how much the company is prepared to borrow to keep pace in the artificial intelligence race.
The offering is split into eight tranches of senior unsecured notes with maturities ranging from three years to 40 years, with some maturities running from 2029 onwards. While most of the notes carry a fixed interest rate, some are floating.
The massive bond sale dragged down outstanding hyperscaler debt on Tuesday as investors sold existing securities to fund the new issue. This trend signals growing fatigue over the barrage of artificial intelligence financings, as hyperscalers have sold an estimated $194 billion in AI-related bonds this year.
Widening spreads on Amazon's latest bond issuance show that the market wants tech giants to pony up as the company continues to buttress its massive investments in artificial intelligence.