Microsoft returns to bond market with $25B raise for AI buildout

Microsoft asked for $25 billion and reportedly got $115 billion in orders. The company priced a senior unsecured bond offering on Oct. 29, 2026, split across ten tranches — its first big US dollar-denominated debt sale since a $17 billion deal back in January 2017. The books came in roughly 4.6 times oversubscribed.

The mix: eight fixed-rate notes and two floating-rate notes worth $1 billion each, due 2028 and 2029. That leaves $23 billion in fixed-rate tranches, with coupons running from 4.85% to 6.35%. Maturities across the whole offering stretch from 2028 out to 2066, and spreads landed between 25 and 105 basis points over Treasuries.

J.P. Morgan, UBS and Wells Fargo worked the deal, which is scheduled to close Nov. 4, 2026. Microsoft's credit profile did a lot of the heavy lifting — it carries AAA from S&P and Aaa from Moody's, the top marks either agency hands out.

Per the deal terms, net proceeds go toward general corporate purposes, a bucket that explicitly includes capital expenditures for AI infrastructure. The sale landed right after Microsoft's fiscal Q1 earnings report, where the company flagged a significant increase in AI-related spending.

The timing fits a broader pattern. Hyperscalers — the giant cloud providers running most of the world's computing capacity — have collectively issued $182 billion in senior notes in 2026, a steep climb from the $93.3 billion raised across all of 2025. Debt is quietly becoming the default way to pay for the AI buildout.

There's an equity-friendly wrinkle here too. Borrowing for data centers avoids diluting existing shareholders the way a stock sale would, and at spreads this narrow, the bond market is looking like the cheaper door. With $182 billion already on the books this year, that door is getting plenty of traffic.