Amazon Launches $12 Billion Bond Sale to Fund AI Infrastructure Expansion

Amazon joins Big Tech bond rush with $12bn debt sale

Amazon is seeking to raise $12bn in its first US bond sale in three years, becoming the latest big tech group to turn to debt markets to fund a spending spree on artificial intelligence infrastructure. The Seattle-based ecommerce and cloud computing giant launched the bond sale on Monday and is targeting approximately $12bn across about six investment-grade bonds, according to a person close to the deal. Goldman Sachs, JPMorgan Chase and Morgan Stanley are managing the sale, according to regulatory filings. Amazon said: "Like all companies, we regularly evaluate our operating plan and make financing decisions -- like entering into a credit agreement or issuing bonds -- accordingly. The proceeds from this issuance will be used to support business investments, fund future capital expenditures, and repay upcoming debt maturities." Big tech companies are in an expensive arms race to build data centres that can power AI. In recent months, many have pivoted to funding large construction projects with debt rather than spending their cash reserves. Google parent Alphabet sold $25bn of bonds earlier this month, Meta sold $30bn in the largest corporate bond sale so far this year in October, and Oracle sold $18bn of bonds in September. US companies have issued more than $200bn worth of corporate bonds this year to fund AI-related infrastructure projects, which analysts have warned could "flood" debt markets and store up new risks for credit investors. The borrowing spree is expected to push US issuance of corporate bonds to a record $1.8tn next year, according to JPMorgan. Goldman Sachs had previously estimated that the "jumbo" tech bond sales accounted for more than a quarter of all net supply of US corporate debt this year. Amazon's cloud computing unit Amazon Web Services is the world's largest provider of leased computing power. Like its rivals, it has expanded investment on infrastructure amid a boom in demand for AI services. Capital expenditures rose 61 per cent to $34.2bn in the third quarter of 2025, bringing the total it has spent so far this year to $89.9bn. Those investments have doubled the amount of computing capacity Amazon has access to since 2022 and it is planning to double it again by 2027, according to comments by chief executive Andy Jassy during its most recent earnings call. It signed a $38bn deal to supply computing power to OpenAI this month, giving the start-up access to hundreds of thousands of its Nvidia chips for seven years. The issuance of AI bonds has hit prices in recent weeks, as investors anticipate hundreds of billions of debt coming in the next few years. "The sudden onslaught of supply is weighing a bit on the market. This AI issuance is coming fast and furious . . . These may be trading at tight spreads, but they promise to reshape the entire market," said Robert Tipp, head of global bonds at PGIM, explaining that the surge in issuance would probably drive yields on longer-dated debt significantly higher.

Amazon seeks to raise $12 billion from US bond sale, Bloomberg News reports

As artificial intelligence workloads grow in scale, big technology firms are turning to large-scale debt sales to fund infrastructure expansion plans that cost tens of billions of dollars Amazon is looking to raise about $12 billion from the corporate bond market in its first such deal in U.S. dollars in about three years, Bloomberg News reported on Monday, as big tech firms increase investments to stay on top of the AI race. The e-commerce giant filed for a six-part bond sale earlier in the day without disclosing a size, a regulatory filing showed. As artificial intelligence workloads grow in scale, big technology firms are turning to large-scale debt sales to fund infrastructure expansion plans that cost tens of billions of dollars. Initial price discussions for the longest portion of the deal, a 40-year bond, are for a premium of about 1.15 percentage points above Treasuries, as per the Bloomberg report, citing people familiar with the matter. Amazon did not immediately respond to a Reuters request for comment. Last month, Meta Platforms announced its biggest bond sale of up to $30 billion, while cloud infrastructure and software maker Oracle is also reportedly looking to raise $15 billion in bond sales. U.S. wireless provider Verizon is also reportedly seeking to raise about $10 billion through bond sales to fund its $20 billion deal for Frontier. Major tech firms including Meta, Amazon and Alphabet are expected to spend $400 billion on AI infrastructure this year, according to Morgan Stanley estimates. Amazon has been spending more on AI with its capital expenditure expected to total around $125 billion this year and more the year after. Proceeds from Amazon's offering may be used for everything from acquisitions and capital expenditures to share buybacks, according to the Bloomberg report. Amazon recently announced a $38 billion deal with OpenAI, giving a major lift to its cloud unit after losing ground to Microsoft and Google. (Reporting by Harshita Mary Varghese in Bengaluru; Editing by Maju Samuel) (You can now subscribe to our ETMarkets WhatsApp channel)