Pendal flags credit risks as AI spending drives bond issuance
QQQ•Pendal says hyperscalers’ growing reliance on bond markets to fund AI spending is drawing greater scrutiny from credit investors, with concerns including negative free cash flow and debt-servicing capacity.
1. Credit risks vary
Amy Xie Patrick said hyperscalers’ growing reliance on bond markets to fund AI spending is drawing greater credit investor scrutiny. Negative free cash flow raises concerns about demand, delivery and funding, while debt-servicing capacity remains central to credit assessments. Risks vary across hyperscalers, data centers and neoclouds as AI-related debt issuance grows.
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