The five major hyperscalers (Google, Amazon, Meta, Microsoft and Oracle) issued between $108 billion and $121 billion in corporate bonds tied to AI-related investment in 2025, versus an annual average of $20-28 billion in prior years. These companies now account for 10% of global investment-grade bond issuance, compared to less than 1% just two years ago. The Fed and IMF have raised concerns about systemic risks stemming from this massive borrowing and high-leverage financing vehicles. Kansas City Fed economists warned that AI financing structures presented concentrated risks and potentially too-big-to-fail characteristics. Both institutions are urging vigilance to prevent AI bond price volatility from turning into a self-reinforcing downward spiral if monetization timelines remain unclear.
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