Microsoft joined within the borrowing spree, pricing a $25 billion bond on October 29 — the corporate’s first main US debt sale in 9 years.
The entire greatest AI firms are borrowing without delay. Alphabet (Gemini AI), SpaceX (Grok AI), Meta (Meta AI), Microsoft (CoPilot AI), together with Oracle, have introduced $129 billion in mixed financing since final week alone.
The inverse correlation between AI inventory efficiency and fundraising by those self same firms is especially apparent since June 30, with a step-up in borrowing as share costs have crashed 27%, as measured by SOXQ, an ETF monitoring the PHLX Semiconductor Sector index.
AI firms supercharge borrowing
On a year-to-date foundation, AI hyperscalers have already borrowed at the very least $214 billion in 2026, already 157% extra than the $83 billion they raised throughout all of 2025.
For instance, Meta’s new financing plan from final Monday paired $35 billion of inventory gross sales with a $60 billion at-the-market inventory sale program.
Days earlier, Mark Zuckerberg’s firm guided $135-145 billion price of 2026 capital expenditures.
That’s principally financing the corporate’s large AI investments, with spending on compute and infrastructure dwarfing all the things Meta plans to generate in working money stream this 12 months.
One other $20B bond providing from Meta, on prime of the $95B in inventory they introduced final week. This comes about 4 hours after Oracle introduced a $20B combined shelf providing.
Every single day, one other 11-figure debt or fairness providing, typically 2 at a time. The second it stops, all hell… pic.twitter.com/jSKyXp3enb
— No one Particular (@JG_Nuke) November 2, 2026
Nebius, an AI neocloud firm, closed a $5.75 billion convertible sale in August. Its communications chief referred to as it one of many largest company convertibles in its historical past.
CoreWeave, a Jensen Huang-endorsed AI neocloud, issued $4.2 billion extra convertible debt on September 22. Its whole debt now exceeds $35 billion.
5-year credit score default swaps of CoreWeave breached a regarding 1,000 foundation factors in October, as credit score traders view its chance of default rising.
Together with off-balance-sheet commitments, hyperscalers’ mixture obligations now sit close to $3.5 trillion, per calculations from UBS.
Credit score default swaps forecast AI bankruptcies
Massive drawdowns in AI shares
As AI executives have raced to borrow extra money, frequent shareholders have suffered declining confidence in enterprise prospects. CoreWeave inventory has declined 63% from its excessive this 12 months. Nebius is down 53%.
Even the bluest of bluechips are delivering large drawdowns.
From their peaks this 12 months, Oracle has declined 55%, Meta 22%, Alphabet 31%, and Nvidia 17%.
Michael Burry, the investor who shorted subprime mortgages earlier than 2008, has informed subscribers that Nvidia’s greater than $500 billion off-balance-sheet financing has “shades of Enron” and reads as “an indication of desperation.”
