Microsoft sells $25B of bonds, its first big US bond deal since 2017, to fund AI spending
Orders peak at $115B
Partly confirmed
The takeaway
On Oct 29, 2026 Microsoft launched a $25B US investment-grade bond sale in up to 10 tranches (2 to 40 years), its first major US issuance since a $17B deal in 2017, to help pay for AI-related capital spending.
Status
- Claim
Partly confirmed
- Our reporting
- Medium confidence
- Importance
- 3 of 5
- Last verified
- 29 October 2026
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Key facts
- Size: $25B in as many as 10 tranches with maturities from 2 to 40 years (Bloomberg Law, Oct 29)
- Demand: orders peaked at about $115B, 4.6 times the offering, ‘one of the most sought-after US corporate bond sales on record’ (Bloomberg data, people familiar)
- First major US bond sale by Microsoft since 2017, when it raised $17B; purpose reported as funding AI-related capital expenditures (Bloomberg via Techmeme)
- Context: a day earlier Microsoft reported $45.2B of quarterly capex (fiscal Q1 2027) and $10B of quarterly revenue from OpenAI (see Microsoft Q1 FY27: $10B of revenue from OpenAI (11% of the total), Azure +48% to $33.2B, commercial backlog $677B); Bloomberg Law notes investors’ portfolios are already ‘stuffed with AI-related debt’
- Other hyperscaler debt this year: Oracle’s $25B sale in February, Alphabet’s repeated dollar and euro deals and Meta’s planned ~$95B AI financing (see Meta launches $95B AI stock sale)
What happened
Microsoft, one of the few top-rated corporate borrowers, returned to the US bond market for the first time in almost a decade with a $25B multi-tranche deal to fund AI-related capital spending. Investor demand peaked at about $115B. Most of the details come from Bloomberg and Bloomberg Law (partly paywalled; the part we read gives the size, the tranches and the order book) and from Techmeme’s summary of Bloomberg’s report. Final pricing was not available when this entry was written.
Why it matters
Even the cash-richest AI spenders now borrow to pay for data centres. The deal follows Oracle, Alphabet and Meta raising tens of billions in debt this year, and the order book shows that bond investors are still willing to fund the build-out while equity investors are punishing it (Alphabet fell 12% the same day after reporting negative free cash flow).
Sources
5 sources from 4 sites. Numbers match the chips in the text.
5 sources: 5 press
Press
- Bloomberg: Microsoft kicks off first US high-grade bond sale since 2017 (Oct 29, paywalled)bloomberg.com, press
- Bloomberg Law: Microsoft eyes at least $25 billion in first US bond since 2017news.bloomberglaw.com, press
- Reuters: Microsoft expects to raise $25 billion in US bond sale, source saysreuters.com, press
- Quartz: Microsoft bond sale of $25 billion for AI spendingqz.com, press
- Bloomberg (Feb 2): Oracle $25 billion bond sale helps ease fears of AI debt wavebloomberg.com, press
Changes
- Filed (news agent; Techmeme, Bloomberg Law; Bloomberg and Quartz could not be read)