Tech companies' AI debt issuance drops sharply in September

Investing.com -- Tech companies raised $23 billion in AI-related debt globally in September, less than half the amount raised in August, according to Morgan Stanley data covering public bonds and private placement transactions.

The decline marks a continued drop from June, when companies raised a record $113 billion for AI infrastructure including data centers and chips. In the US investment-grade market, where blue-chip tech groups borrowed around $306 billion between January and August, AI-related bond issuance stopped completely last month.

Morgan Stanley attributed the decline to the large amount of debt already raised earlier this year. The firm also noted growing investor concerns about whether heavy investments would generate returns and increasing political opposition to data center construction.

Companies have raised an estimated $466 billion in AI-linked debt in 2026 so far, up from $101 billion during the same period last year, according to Morgan Stanley.

The slowdown arrives as Wall Street banks assemble a $60 billion financing package for Broadcom and Anthropic, while SpaceX is in talks to raise $40 billion to purchase Nvidia chips. Both deals are expected to be syndicated to investors in the coming months.

Data centers across the US have faced local opposition from residents concerned about effects on water supply and air quality. Oracle's data center campus in New Mexico, called "Project Jupiter," has become a point of conflict. About $18 billion of loans tied to the project are under strain after Oracle issued a force majeure notice when the site struggled to gain access to electricity. The loans were privately quoted at around 85 cents on the dollar in recent days, according to people familiar with the transaction.

The increased volume of new debt supply has allowed credit investors to demand higher yields to finance certain projects, driving up borrowing costs for hyperscalers.

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