Microsoft is raising at least $25 billion through a US investment-grade bond sale, its first in more than nine years, to help finance capital expenditures driven by artificial intelligence demand1,3.
The company announced pricing for the $25 billion offering on October 30, with the deal expected to close on November 42. Microsoft holds a top-tier AAA rating from S&P, giving it favorable access to the debt market.
Microsoft is targeting $170 billion in capital expenditures for 2026 as it works to meet demand from AI labs Anthropic and OpenAI, along with other clients. Finance chief Amy Hood told analysts on October 29 that the company had access to the debt market but had not tapped it.
According to a company statement, "Microsoft intends to use the net proceeds from the offering for general corporate purposes, which may include, among other things, funding for working capital, capital expenditures, repurchases of capital stock, acquisitions, and repayment of existing debt".
The last time Microsoft issued US investment-grade bonds was in 2017, when it raised $17 billion.
Microsoft is not alone in turning to bonds to back infrastructure expansion. Amazon and Alphabet have engaged the bond market to support infrastructure projects this year, and AI-focused cloud provider CoreWeave has also relied on debt to broaden its data center footprint.
ANALYSIS The bond sale follows Microsoft's recent disclosure of strong Azure revenue growth, which provided the financial backdrop for a debt raise of this scale[3].