In 2025, the companies collectively reported $405 billion in capex. By year end for 2026, that figure is expected to reach $750 billion, per Goldman Sachs, before nearing $1.2 trillion in 2027. <\/p>\n
At the same time, those companies have found themselves increasingly unable to fund those investments with cash alone. In its mid-July earnings report, Alphabet reported its first quarter of negative free cash flow since the company went public as Google in 2004. <\/p>\n
To make up that difference, the hyperscalers have turned increasingly toward debt markets. In 2025, investment-grade-rated global bond issuance from the hyperscalers totaled $108 billion, per Goldman Sachs, or roughly 26% of capex. Through the first half of 2026, those companies have already issued $194 billion of IG-rated debt, with that figure expected to reach roughly $250 billion in debt issuance, or roughly 33% of capex. <\/p>\n
In 2027, Goldman Sachs said, the share of debt-funded capex is likely to rise even further, with $400 billion in expected global IG bond issuance from the hyperscalers against an estimated $1.14 trillion in capex, or a roughly 35% share. <\/p>\n
This data doesn’t include debt issuance by companies that have made deals with tech hyperscalers, essentially off-balance sheet debt. On Tuesday, for example, Meta announced a new joint venture with the alternative assets giant BlackRock (BLK<\/a>), designated to fund a large-scale data center in El Paso, Texas. <\/p>\n While the project “represents an investment of over $10 billion from Meta,” per the press release, BlackRock will hold an 80% stake in the project, and a portion of BlackRock’s investment “will be funded with proceeds from a $12.5 billion debt financing.” <\/p>\n The debt projections also leave out lease obligations, which all five hyperscalers have disclosed, totaling roughly $1.2 trillion \u2014 $725 billion of which represents leases that have not yet begun. <\/p>\n The figures from Goldman Sachs also don’t include AI-linked debt issuance by companies outside of the hyperscalers, which already in 2026 has totaled roughly $412 billion, covering a range of companies in sectors such as software, semiconductors, and data center financing. <\/p>\n That said, looking at the hyperscalers, those companies retain “extraordinary debt capacity” for the debt they’re issuing, Goldman’s strategists said, even if projections are “tempered” by off-balance sheet obligations. <\/p>\n If all four primary hyperscalers \u2014 Meta, Microsoft, Alphabet, and Amazon \u2014 pushed their use of debt to a 2x net leverage ratio, the strategists estimate between $1.3 trillion and $1.4 trillion in debt capacity, with that figure expected to grow. As a result, the firms remain highly rated for debt issuance, with their investment-grade debt rated at AAA or AA. <\/p>\n “While we do not expect all of this debt to be issued in the traditional IG corporate bond markets, there is scope, in our view, for the hyperscalers to lean more into broader debt financing channels to support AI-related capital investments,” the strategists wrote. Project finance, private credit, asset-backed financing, and other forms of debt outside of the investment-grade bond market can all play a role so long as the market remains hungry for issuance. <\/p>\n Jake Conley is a breaking news reporter covering US equities for Yahoo Finance. Follow him on X at @byjakeconley or email him at jake.conley@yahooinc.com. <\/p>\n<\/a> Debt is set to comprise an increasing share of hyperscaler capex funding through 2027, according to Goldman Sachs. (Chart: Goldman Sachs) \u00b7 Goldman Sachs <\/p>\n
<\/a> A view shows a Microsoft logo at Microsoft offices in Issy-les-Moulineaux near Paris, France, March 25, 2024. (REUTERS\/Gonzalo Fuentes) \u00b7 Reuters \/ REUTERS <\/p>\n