The biggest companies leading the artificial intelligence infrastructure buildout have said they expect hundreds of billions of dollars in capital expenditures through 2026. That trend is only set to accelerate and will be funded increasingly with debt, according to Goldman Sachs.
“While the exact magnitude and mix of future debt issuance from the hyperscalers is uncertain, our review of management commentary leaves us expecting a growing role for debt financing in the AI buildout in the years ahead,” credit strategists led by Amanda Lynam said in a research note this week.
A hyperscaler is a large tech company that builds and operates massive data center infrastructure for computing, storage, and AI processing.
Over the past year and a half, capital expenditures from the leading hyperscalers — Meta (META), Microsoft (MSFT), Alphabet (GOOG), Amazon (AMZN), and Oracle (ORCL) — have boomed, as those companies have entered into an arms race focused on the buildout of vast infrastructure underpinning AI development.
In 2025, the companies collectively reported $405 billion in capex. By year end for 2026, that figure expected to reach $750 billion, per Goldman Sachs, before nearing $1.2 trillion in 2027.
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.
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.
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.
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, designated to fund a large-scale data center in El Paso, Texas.
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.”
