From Europe to Japan and Switzerland, huge bond issues by Big Tech companies are proving that smaller markets can punch above their weight in the $40 trillion world of corporate debt.
Google-parent Alphabet is already one of the biggest borrowers in sterling and Swiss franc corporate bond markets, while Amazon raised 14.5 billion euros in March from an eight-part deal, the largest ever in the euro corporate bond market.
Debt issues by "hyperscalers" outside the U.S. are part of a push to diversify funding, bankers said, as they look to finance trillions of dollars of investment in AI infrastructure, especially data centers.
Alphabet smashed records across markets, with its yen, Canadian dollar, Swiss franc and sterling deals all setting borrowing records. "If you look at the pace of investment, some of these companies will become among the biggest issuers globally in any currency," said Giulio Baratta, co-head of investment-grade finance at BNP Paribas.
Morgan Stanley expects around 50 billion euros of total borrowing from hyperscalers in euro debt this year. John Servidea at JPMorgan said: "A lot of these markets, including euro, now offer more depth for larger capital raising."
Hyperscalers have seen their non-dollar issuance double to 30% of total bond funding this year, according to Bank of America. Investors are keen to build exposure to the AI theme in international bond markets.
As tech issuance grows, corporate bond markets outside the U.S. will become more exposed to tech sector developments. "If there are any problems with AI, it will probably create more volatility," said David Zahn, head of European fixed income at Franklin Templeton.
