(Feb 10): Alphabet Inc is set to raise almost US$32 billion in debt in less than 24 hours, showing the enormous funding needs of tech giants competing to build out their artificial intelligence (AI) capabilities — and the huge appetite from credit markets to fund them.
The Google parent followed Monday’s US$20 billion seven-part dollar debt sale with sterling and Swiss franc-denominated offerings which broke records in both markets. The sterling issue includes an ultra-rare 100-year note — the first sale with such an extreme maturity by a technology firm since the dot-com era, according to data compiled by Bloomberg.
Demand was high across the deals, with the US tranches getting more than US$100 billion of orders, according to people with knowledge of the matter. The sterling century bond has drawn close to ten times orders for the £1 billion on offer. Such a wide range of maturities in different markets meant there was something for investors of all stripes — from asset managers and hedge funds to the pension funds and insurers that favor longer-dated debt.
The deal hit the market less than a week after Alphabet said its capital expenditures will reach as much as US$185 billion this year — double what it spent last year — to finance its AI ambitions. Software giant Oracle Corp also recently raised US$25 billion to fund its AI plans, drawing US$129 billion of demand.
Other tech firms, including Meta Platforms Inc and Microsoft Corp, have announced huge spending plans for 2026, while Morgan Stanley expects borrowing by the massive cloud-computing companies known as hyperscalers to reach US$400 billion this year, up from US$165 billion in 2025.
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“Hyperscalers will keep coming and big,” said Andrea Seminara, chief executive of Redhedge Asset Management LLP, a London-based hedge fund. “They need to issue more so they are testing everything, all the available pockets and appetite. And it will be the same for everyone,” he added, referring to other hyperscalers.
The massive borrowing needs of big tech firms have started to raise some concerns about potential pressure on bond valuations. The securities are already expensive by historical standards. Some investors are also concerned about the longevity of the AI boom — and its disruptive effects on related firms, like those in the Software-as-a-Service sector.
Alphabet and Oracle both made moves to ease investor concerns over heavy supply. Alphabet tapped a range of typically more niche markets to raise large sums without overwhelming demand, while Oracle capped its deal size to limit the amount of debt hitting the market.
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100-year bond
Alphabet’s 100-year note is the first sale with such an extreme maturity by a technology firm since Motorola sold this type of debt in 1997, according to data compiled by Bloomberg. The market for 100-year bonds is dominated by governments and institutions like universities. For corporates, potential acquisitions, outdated business models and technological obsolescence make such deals a rarity.
“I could not justify taking such a long maturity bond in most companies — especially not one subject to an ever-changing landscape,” said Alex Ralph, co-portfolio manager of Nedgroup Investments Global Strategic Bond Fund. “100-year bonds tend to have a habit of calling the top of a market as well.”
Still, demand from UK pension funds and insurers has made sterling a go-to market for issuers seeking longer-dated funding, and investors turned out in force for the century bond. It’s set to price at 120 basis points (bps) over the UK government benchmark while the shortest tranche — just three years — has been set at 45bps over gilts.
Global corporates have also been turning to the Swiss franc bond market in recent years to diversify their debt-raising programs. In 2025, US firms including Thermo Fisher Scientific Inc and construction equipment maker Caterpillar Inc. sold Swiss franc debt.
Alphabet tapped the euro bond market as recently as November, raising €6.5 billion. That deal, added to an issue earlier in the year, made it the biggest borrower in the euro market in 2025, according to data compiled by Bloomberg.
The £5.5 billion sterling offering far surpassed the previous record corporate bond sale in the sterling market — a £3 billion sale by National Grid plc in 2016. In the Swiss market, Alphabet’s sale edged out a prior record three billion Swiss franc sale from Roche Holding AG.
Bank of America Corp, Goldman Sachs Group Inc and JPMorgan Chase & Co are arranging both the sterling and Swiss franc offerings, with Barclays plc, HSBC Holdings plc and NatWest Group plc also on the sterling deal. BNP Paribas SA and Deutsche Bank AG are on the Swiss franc issue.
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