New money, same AI obsession
The AI trade has found a new wallet: debt. Instead of just leaning on sky-high stock prices and fresh equity narratives, the biggest tech spenders are now pushing deeper into the bond market to keep the servers humming and the data centers growing.
UBP estimates Microsoft, Amazon, Alphabet, Meta, and Oracle could spend roughly $820 billion on capex in 2026 versus about $750 billion in operating cash flow. That’s already a squeeze. By 2027, projected spending jumps to $1 trillion to $1.3 trillion, which is the kind of gap that doesn’t politely disappear just because the market is in a good mood.
Bond investors, meet the AI supercycle
This is where things get a little more interesting — and a little less cozy. The Financial Times says Goldman Sachs estimates investors have already funneled about $500 billion into AI-linked groups this year, with the five hyperscalers accounting for around $200 billion of that total.
And it’s not just plain-vanilla corporate bonds doing the heavy lifting. The article points to:
- project finance
- securitization
- leveraged loans
- chip-backed financing
Translation: the AI buildout is getting financed the way a giant movie franchise gets funded — lots of studios, lots of checks, and a lot of people hoping the sequel prints money.
Why this matters for your portfolio
The risk here isn’t just that AI stocks get pricey. It’s that the financing burden starts showing up in credit markets too. The ECB says hyperscalers issued more than $100 billion of bonds last year and now make up close to a tenth of new euro bond issuance by non-financial companies.
That can ripple into:
- wider bond spreads if investors get picky
- higher borrowing costs for AI-heavy companies
- tougher competition for capital across the market
- slower capex if returns don’t catch up
Big picture
This whole AI era may end up being judged less by who bought the most chips and more by who can turn all those chips into cash flow. If the math keeps getting bigger faster than the earnings, the next AI catalyst may not be on the Nasdaq — it may be in credit markets you usually only think about when your portfolio is already having a bad week.