US hyperscale technology giants are rapidly issuing corporate bonds on international capital markets to finance their multi-trillion-US dollar investment plans for artificial intelligence (AI) infrastructure, particularly data centers.

Since the start of the year, Alphabet has repeatedly broken issuance records across multiple markets. Its bond deals in Japanese yen, Canadian dollars, Swiss francs, and British pounds have all achieved unprecedented fundraising levels for these currencies. A notable example is the 576,5 billion Japanese yen issuance on 15/5.

Alphabet currently stands as one of the largest borrowers in both the British pound corporate bond market, having raised 5,5 billion pounds, and the Swiss franc market, with 3,1 billion francs. The company also issued bonds valued at 9 billion euro and 8,5 billion Canadian dollars.

Google Gemini AI app logo on a phone, march 2025. Photo: Luu Quy

Meanwhile, Amazon raised 14,5 billion euro (16,88 billion USD) in march through an 8-tranche bond issuance. This transaction became the largest ever in the euro corporate bond market, according to LSEG data.

In Europe, Amazon and Alphabet's activities have pushed the total value of bonds issued by US non-financial companies to a new record high: over 60 billion euro (69,85 billion USD) since the start of the year.

"Looking at the current pace and projecting over the next 12 months, some of these companies are set to become the world's largest bond issuers in any currency," commented Giulio Baratta, co-head of investment grade finance at BNP Paribas.

Bank of America reports that non-USD bond issuances by hyperscalers have doubled this year, now accounting for 30% of their total bond capital raised. Experts attribute this to a strategy of diversifying funding sources. This approach helps tech corporations hedge against exchange rate risks and capitalize on lower borrowing costs in markets such as Europe.

Morgan Stanley projects that euro bonds issued by hyperscalers this year could reach approximately 50 billion euro. This volume would enable the US to surpass France, becoming the largest source of corporate bond issuance in the eurozone.

"Many markets, including the euro, have developed significantly, now offering much greater depth and fundraising opportunities than before," remarked John Servidea, co-head of global investment grade finance at JPMorgan.

Additionally, Servidea noted that raising capital abroad allows these corporations to extend the intervals between their returns to the US bond market. Large debt volumes typically depress the prices of an issuer's bonds, and less frequent appearances in the US market can help mitigate this effect.

Baratta of BNP Paribas, a bank involved in leading Alphabet and Amazon's deals, indicated that most of the capital raised is retained by the companies in the issuing currency, rather than being converted back to US dollars.

Investors are also increasingly seeking exposure to the AI theme through international bond markets, an area where tech companies previously had limited presence. For instance, Nicolas Forest, investment director at Candriam, is actively purchasing euro bonds issued by hyperscalers to boost his firm's AI investment allocation.

By the end of april, following just one issuance, Alphabet had become the fourth largest borrower in ICE BofA's British pound corporate bond index. It also ranked sixth in the Swiss franc market.

However, a significant risk emerges as tech companies' issuance activity continues to rise: non-US corporate bond markets will become increasingly susceptible to the performance of the AI industry, both in times of prosperity and difficulty.

"Any problems encountered by AI will create more volatility for these markets," stated David Zahn, head of European bond investment at Franklin Templeton.

Phien An (according to Reuters)