Big Tech drives US corporate bond sales to annual record high, data shows
XLK•US investment-grade corporate bond issuance reached a record $1.88 trillion through November 4, up 18.7% from a year earlier. Hyperscalers raised more than $370.7 billion, about a fifth of the total.
1. Issuance hits new record
US investment-grade corporate bond issuance climbed to $1.88 trillion through November 4, surpassing the previous annual record of $1.86 trillion set in 2020. The total rose 18.7% from a year earlier even as the number of offerings fell about 4% to 1,084, lifting the average offering size to roughly $1.7 billion from about $1.4 billion.
2. Hyperscalers lead borrowing
Amazon and Alphabet raised the most through bond sales this year. Including Meta Platforms, Microsoft and Oracle, hyperscalers raised more than $370.7 billion, or roughly a fifth of US investment-grade issuance so far this year. Apple also tapped the bond market this week, seeking about $7.5 billion through a seven-part US-dollar offering.
3. Risks to debt demand
Investors are weighing whether AI investment will translate into profits quickly enough to cover rising interest costs. Oracle's five-year default-insurance spread reached a record 325.45 basis points last month; Amazon, Alphabet, Nvidia and Meta also set records, though below Oracle's level. Goldman Sachs expects bond issuance to fund 35% of hyperscalers' capital expenditure in 2027, roughly in line with this year's level.
