Amazon is raising $12 billion through its first US bond sale in three years, joining a wave of Big Tech companies turning to debt markets to finance massive spending on artificial intelligence infrastructure. The move signals that even cash-rich tech giants are choosing to borrow rather than drain their reserves as the AI arms race intensifies.
Tech Giants Choose Debt Over Cash Reserves
The Seattle-based ecommerce and cloud computing giant launched the bond sale Monday, targeting approximately $12 billion across six investment-grade bonds, according to a person familiar with the deal. Goldman Sachs, JPMorgan Chase, and Morgan Stanley are managing the offering.
Amazon stated the proceeds will “support business investments, fund future capital expenditures and repay upcoming debt maturities”—corporate speak for financing its aggressive expansion in AI infrastructure while maintaining financial flexibility.
The company’s decision to tap debt markets rather than use its substantial cash pile reflects a strategic shift across the tech sector. Despite having ample resources, these companies are taking advantage of their strong credit ratings to borrow at relatively low rates while preserving cash for other opportunities and shareholder returns.
The AI Infrastructure Arms Race Heats Up
Big Tech is locked in an expensive competition to build the data centres and computing infrastructure needed to power AI applications. In recent months, major players have increasingly funded these massive construction projects through bond sales rather than cash spending.
The numbers are staggering:
- Google parent Alphabet sold $25 billion in bonds earlier this month
- Meta issued $30 billion in October—the largest corporate bond sale of 2025
- Oracle raised $18 billion through bond sales in September
- US companies have issued over $200 billion in corporate bonds this year specifically for AI-related infrastructure
This borrowing spree is expected to push total US corporate bond issuance to a record $1.8 trillion next year, according to JPMorgan estimates. Goldman Sachs previously calculated that these “jumbo” tech bond sales accounted for more than a quarter of all net supply of US corporate debt this year.
Amazon Web Services: Powering the AI Boom
Amazon Web Services (AWS) is the world’s largest provider of leased computing power, making the company central to the AI infrastructure buildout. Like its rivals, AWS has dramatically expanded its investments to meet exploding demand for AI services.
The scale of spending is remarkable: Amazon’s capital expenditures surged 61% to $34.2 billion in the third quarter of 2025 alone, bringing its total spending so far this year to $89.9 billion.
Those investments have already doubled Amazon’s computing capacity since 2022. CEO Andy Jassy announced during the company’s most recent earnings call that Amazon plans to double capacity again by 2027—a testament to how much growth the company anticipates in AI demand.
Earlier this month, Amazon signed a $38 billion deal to supply computing power to OpenAI, giving the ChatGPT creator access to hundreds of thousands of Nvidia chips for seven years. Deals like this explain why Amazon needs to keep building at breakneck speed.
Bond Markets Feeling the Strain
The sudden flood of tech debt issuance is starting to impact bond market dynamics. Analysts warn that the sheer volume of supply could “flood” debt markets and create new risks for credit investors.
“The sudden onslaught of supply is weighing a bit on the market. This AI issuance is coming fast and furious,” said Robert Tipp, head of global bonds at PGIM. “These may be trading at tight spreads, but they promise to reshape the entire market.”
Tipp explained that the surge in issuance would likely drive yields on longer-dated debt significantly higher. When bond supply increases dramatically, prices tend to fall and yields rise to attract buyers—basic supply and demand economics.
For context, these tech companies enjoy investment-grade credit ratings and are considered extremely safe borrowers, allowing them to issue bonds at relatively low interest rates (tight spreads) compared to their debt maturity dates. However, even safe debt can pressure markets when the volume becomes overwhelming.
What This Means for Crypto and Risk Assets
While this story centres on traditional corporate bonds, it has implications for cryptocurrency markets and other risk assets. Here’s why:
Rising bond yields compete with crypto: When safe corporate bonds from companies like Amazon offer attractive returns, they pull investment dollars away from riskier assets like cryptocurrencies that don’t generate income. Higher yields on bonds make the risk-reward calculation less favourable for speculative investments.
Liquidity dynamics: The massive absorption of capital into tech bonds—$200 billion this year alone—represents money that could otherwise flow into alternative investments, including crypto. When traditional markets offer compelling opportunities, speculative capital tends to migrate there.
Market sentiment indicator: The fact that tech giants are borrowing aggressively to fund AI infrastructure reflects their conviction that AI will generate returns justifying these investments. This “traditional tech” optimism could overshadow crypto narratives, particularly if AI continues dominating investor attention and capital flows.
Interest rate implications: If the flood of bond issuance drives yields higher across the board, it could pressure the Federal Reserve to maintain higher interest rates longer to prevent overheating. Higher rates have historically been bearish for Bitcoin and other cryptocurrencies.
The Bigger Picture: Tech’s Bet on AI
The borrowing binge underscores how seriously Big Tech is taking the AI opportunity—and threat. Companies fear falling behind competitors in AI capabilities, which they view as potentially existential. Missing out on the AI revolution could mean losing relevance in a decade.
This explains why even Amazon, which generated $70 billion in operating cash flow over the past year, is choosing to issue $12 billion in bonds rather than simply spending cash. The company wants to maintain maximum financial flexibility while still investing aggressively in infrastructure.
The strategy makes sense from a corporate finance perspective: borrow at low rates (thanks to strong credit ratings), invest in high-return AI infrastructure, and keep cash available for acquisitions, shareholder returns, or unexpected opportunities.
However, the scale and speed of this debt accumulation raise questions. If AI returns don’t materialise as hoped, these companies will be left servicing enormous debt loads. If multiple tech giants simultaneously scale back investments or face disappointing AI monetisation, it could trigger volatility across financial markets.
A Watershed Moment for Corporate Debt
Amazon’s $12 billion bond sale marks another milestone in what’s becoming a historic shift in corporate financing. Never before have so many highly rated companies issued so much debt in such a short period for a single type of investment.
Whether this represents prudent capital allocation or excessive exuberance won’t be clear for years. What is clear is that Big Tech is making a massive, debt-fuelled bet that AI infrastructure will generate returns justifying these unprecedented spending levels.
For investors in crypto and other risk assets, the takeaway is that traditional tech is sucking up enormous amounts of capital that might otherwise seek higher-risk, higher-reward opportunities. Until this AI infrastructure buildout moderates or crypto narratives strengthen, the sector may continue facing headwinds from competing investment opportunities in traditional markets.
Disclosure: This analysis reflects market dynamics and should not be considered investment advice. Corporate bond markets and cryptocurrency markets both carry risks.
