Alphabet’s $100 Billlion Century Bond Raises Eyebrows

This article first appeared on GuruFocus.

Alphabet (NASDAQ:GOOGL) is going all in on artificial intelligence, funding its AI buildout with a $100 billion century bond, a move one strategist calls an extraordinary wager on a technology that is only 3 years into the mainstream spotlight.

The bond was reportedly oversubscribed 10x, showing investors are still willing to back Big Tech for the long haul. But Fundstrat strategist Hardika Singh told CNBC the scale and timeline make this different. Google itself is 28 years old and Google’s just taking a huge bet on it with this $100 billion bond offering, she said, contrasting it with older companies that historically issued 100 year debt.

History is not always kind to ultra long promises. JCPenney issued century bonds in the late 1990s and went bankrupt 23 years later. General Motors (NYSE:GM) also struggled after loading up on long duration debt. Singh’s bigger point is simple but uncomfortable. Can Alphabet keep reinventing itself for 100 years in a tech landscape that shifts every decade?