Microsoft Seeks to Raise At Least $25 Billion in First US Investment-Grade Bond Sale Since 2017 to Fund AI Capex
Microsoft has launched a bond offering seeking at least $25 billion, marking its return to the US investment-grade debt market for the first time in over nine years to finance artificial intelligence infrastructure.
According to Bloomberg, Microsoft Corp. is seeking to raise at least $25 billion through a US investment-grade bond offering, its first entry into this market since 2017. The massive issuance spans up to 10 tranches with maturities ranging from two to 40 years, managed by JPMorgan Chase, UBS Group, and Wells Fargo.
Microsoft has historically relied on its substantial internal cash generation to fund operations and investments. Its last high-grade debt sale was in 2017, raising $17 billion. As one of only two publicly traded US companies with top-tier AAA ratings from Moody's and S&P Global (alongside Johnson & Johnson), Microsoft's return signals a shift in financing strategy among major tech firms. With AI infrastructure costs soaring, even the most cash-rich enterprises are turning to external debt markets.
Proceeds will be used for general corporate purposes, including capital expenditures, working capital, share repurchases, acquisitions, and repayment of existing debt. The report notes that this deal serves as a crucial test of investor appetite for financing AI investments amid growing concerns about the sustainability of the industry's spending spree. The final size of the offering remains undecided and may change according to demand.