Company Fundraising Heats Up on AI Boom as Bond Sales Hit Record

2026-07-22

Bond Issuance Hits Record High

Company fundraising is heating up on the back of a surge in demand tied to artificial intelligence (AI). Global bond issuance totaled about $3.6813 trillion from January to June, or about 580 trillion yen, marking a record for the same period for a second straight year. Investors are beginning to seek higher yields amid concerns over aggressive investment by major U.S. tech firms.

According to a survey by London Stock Exchange Group (LSEG), global issuance rose 10% from a year earlier. It has increased for four straight years since bottoming out in January-June 2022 after the COVID-19 pandemic, and the scale has expanded 1.5 times. The number of issues, however, fell 12% to 10,408, showing a shift toward larger deals. LSEG compiled the data from 2000 onward.

Fundraising Concentrates on U.S. Giants

Total fundraising, including shares and bonds with stock acquisition rights (convertible bonds, or CBs), also came to about $470 billion, the second-highest on record after January-June 2021. Combined with bond issuance, total fundraising reached a record 660 trillion yen scale, a level comparable to Japan's gross domestic product (GDP).

Large bond sales have been concentrated among U.S. companies. The biggest was the $36.8 billion issued by Amazon.com in March, which raised about $54 billion when combined with euro-denominated bonds sold at the same time. The funds are expected to be used for cloud and AI data center investment. Meta Platforms and Nvidia also issued about $25 billion each in bonds, and Nvidia will use the proceeds for advanced chip development. The U.S. share of global bond issuance topped 30% for the first time in six years.

In a report released in late June, Bank of America (BofA) said global AI-related bond issuance had reached $220 billion in cumulative terms from the start of 2026. Japanese companies' total bond issuance reached a record $155.6 billion when converted into dollars, up 35% from a year earlier, but AI-related issuance alone already exceeds that by a wide margin.

Investor Caution Deepens

Fundraising is also spreading among Japanese companies. In April, SoftBank Group decided to issue about 570 billion yen in bonds in dollars and euros. The proceeds will be used for costs related to its investment in OpenAI. Panasonic Holdings also issued $500 million in dollar-denominated bonds in July, and AI-related fundraising continues to expand.

Market concern is spreading over the rapid expansion in bond supply. When Amazon decided in July to issue about $25 billion in bonds, bond spreads, or the yield premium over benchmarks, for hyperscalers, including the company, widened sharply. Meta's spread widened from the 1.2% range to the 1.4% range, reflecting that investors who have absorbed issuance on an unprecedented scale are beginning to demand higher yields.

Uncertainty Over Monetization

There are also doubts over whether upfront investment in data centers will deliver results as expected. Capital spending by Amazon, Microsoft, Alphabet and Meta in January-March 2026 exceeded operating earnings for the first time since 2020. Meta plans to spend $125 billion to $145 billion on capital expenditure in 2026.

Oracle said in its annual report disclosed in June that AI investment could end in failure. It cited risks such as delays in data center construction and the possibility that major customers may not pay usage fees even after completion. On the 9th, S&P Global Ratings cut Oracle's long-term issuer credit rating to 'BBB minus', the lowest investment-grade level, citing the expansion of AI investment.

A concentration of funding in a particular industry could destabilize markets. In a June report, the Bank for International Settlements (BIS) warned that, given the expansion of AI financing and widening bond spreads, 'if the AI boom stalls, financial system stability could also be threatened. One particularly vulnerable area is the bond market.'

John Waldron, president and chief operating officer of Goldman Sachs, told Nikkei that the competition for AI-related fundraising 'has a winner-takes-all character.' He said larger companies have better access to capital markets and can more effectively advance spending and investment in AI.

Enjoyed this article? Share it with your network!