Investor fears about artificial intelligence debt eased after a period of volatility, helped by Meta’s decision not to announce a bond offering. The credit-default swap spreads of Meta and Amazon nevertheless remain 177% and 129% higher, respectively, year to date, while both companies are expected to report negative free cash flow. Oracle, which has $117 billion of long-term debt and retains a BBB-1 rating, will present its outlook Wednesday, followed by quarterly results from Alphabet, Amazon and Microsoft. Investors will focus on capital-expenditure forecasts: Alphabet is expected to spend $55.2 billion and Amazon $58.7 billion in the third quarter, against estimated free cash flow of negative $2.3 billion and negative $9.9 billion, respectively. S&P Global Ratings expects the hyperscalers to have negative free operating cash flow in 2026 and 2027 and warns that off-balance-sheet commitments related to data centers and chips are not fully transparent.
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