Crazy fundraising nearly $17 billion! Alphabet (GOOGL.US) makes a bold move in cross-border issuance, ramping up investment in AI race.

Under the pressure of massive investments in AI, Alphabet Inc. Class C, the parent company of Alphabet (GOOGL.US), has made a large cross-border financing move. The company issued its largest-ever euro-denominated bond and introduced Canadian-dollar-denominated bonds for the first time, raising nearly $17 billion in total, further expanding its non-US dollar financing. Alphabet's multi-currency bond issuance is a bold move to bet big on the AI race. According to sources, Alphabet's euro bond issuance this time reached 9 billion (approximately $10.5 billion) in size, divided into 6 tranches, attracting over 18.3 billion in subscriptions. The company's Canadian dollar bond issuance reached C$8.5 billion (approximately $6.2 billion) in size, divided into 4 tranches, setting a record for the largest issuance of investment-grade corporate bonds denominated in Canadian dollars, with over C$20 billion in subscriptions, reflecting strong market demand. Karl Schamotta, Chief Market Strategist at Corpay, analyzed that as the competition in the US dollar bond market intensifies, companies are turning to markets outside the US for financing, which can also meet global investors' demand for investments in US AI assets. US tech giants, including Alphabet, are expanding their non-US dollar financing scale As a global tech giant, Alphabet's financing moves are closely related to its AI investment layout. The company explicitly stated last week that it plans to invest up to $190 billion this year in data centers and other capital expenditures, with the majority of the funds going towards AI-related infrastructure construction. Sources revealed that the proceeds from the latest financing will be used for general corporate purposes, including possible debt refinancing. In fact, since last year, Alphabet has raised $86 billion in total, with nearly half of the funds coming from non-US dollar currency financing. In February of this year, the company issued $20 billion in US dollar bonds, setting a record for its largest US dollar bond issuance, with peak subscriptions reaching $103 billion, far exceeding the fundraising target; prior to that, the company also issued pound and Swiss franc-denominated bonds for the first time, continuously enriching its range of financing currencies. AI financing continues to surge, with signs of investors' patience wearing thin Industry insiders stated that tech giants such as Alphabet, Meta, Microsoft Corporation, Amazon.com, Inc., among others, plan to invest a total of $725 billion this year in AI data center equipment and related capital expenditures, a significant increase from previous expectations. Ian Horn, Portfolio Manager at Muzinich & Co Ltd, commented on these cloud computing companies, saying, "These companies will become more and more important in the bond market, just as they are in the stock market." The capital expenditures planned by the four major US tech giants in 2026 will exceed $700 billion However, it is worth noting that as the scale of financing in the AI field continues to rise, investors are showing signs of fatigue. Meta completed a $25 billion bond issuance on April 30th. Concerns in the market about its massive investments in AI potentially not generating sufficient returns led to the company's stock price experiencing its largest single-day decline in six months. The risk premium for Meta's bond tranches has increased compared to before, indicating that investors are demanding higher returns; at the same time, the enthusiasm for subscriptions has cooled. The cost of Alphabet's recent euro bond issuance has also increased, with pricing for tranches of the same maturity rising compared to November last year, and new issuance discounts slightly increasing, reflecting to some extent investors' cautious attitude towards financing AI companies. The euro bond issuance by Alphabet was arranged by Barclays PLC Sponsored ADR, BNP Paribas, Deutsche Bank Aktiengesellschaft, and HSBC, while the Canadian dollar bonds were arranged by Bank of Nova Scotia, Royal Bank of Canada, and Toronto-Dominion Bank. S&P Global, Inc. has given the proposed euro and Canadian dollar bonds an AA+ rating.