microsoft on Thursday announced plans to use its healthy credit rating to raise $25 billion in bonds to support infrastructure expansion.
The software maker has the highest rating of AAA from credit reporting agency S&P. Management is targeting $170 billion in capital spending in 2026 to meet strong demand from artificial intelligence lab Anthropic, OpenAI and other customers.
“Microsoft intends to use the net proceeds from this offering for general corporate purposes, which may include, among other things, working capital, capital expenditures, stock repurchases, acquisitions, and the repayment of existing debt,” the statement said. According to the company, recruitment is scheduled to end on November 4th.
Amazon and alphabet This year, we are leveraging the bond market to support infrastructure projects and cloud with a focus on AI. coreweave The company is also relying on the debt market to expand its data center footprint. As central banks raise interest rates to combat inflation, investors are becoming more wary of companies laden with large amounts of debt.
Microsoft Finance Director Amy Hood said on Wednesday’s earnings call that Microsoft plans to access additional funding sources to supplement its cash flow generation when terms are attractive.
“There is a form of financing called a lease, and we have used that as a vehicle,” she said. “Given the rating situation, we are fortunate to have access to the bond market, but we have not yet taken advantage of it.”
Microsoft reported positive free cash flow on Wednesday, setting itself apart from Alphabet, which has had negative cash flow for the second consecutive quarter. last week meta announced negative free cash flow, and on Thursday, Amazon reported negative free cash flow.
Also on Wednesday, oracle announced plans to raise $10 billion in new debt and said it expects to return to positive free cash flow in the second half of fiscal 2028.
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