Global borrowing tied to artificial intelligence is expected to rise sharply in 2026, with Morgan Stanley forecasting that total AI-related debt issuance could climb to nearly $570 billion. The increase reflects a rapid expansion in borrowing activity as major technology firms and chipmakers seek new ways to fund the massive costs of building AI infrastructure.
According to the bank, AI-linked debt issuance stood at about $236 billion as of May 31, 2026, representing a fourfold increase compared to the same period a year earlier. This surge highlights how quickly financing needs have escalated as companies scale up investments in data centers, advanced chips, and cloud computing systems required to support AI development.
Large technology companies that traditionally relied on strong cash reserves are now increasingly turning to debt markets to cover rising capital expenditures. Firms such as Alphabet, Amazon, Microsoft, and Meta are expected to collectively spend around $700 billion this year alone, underscoring the scale of investment driving this borrowing trend.
Morgan Stanley also expects issuance to accelerate in the second half of 2026, with total hyperscaler spending projected to surpass $1 trillion by 2027. The bank noted that many of these companies are expanding their investor base through non-U.S. dollar debt offerings, broadening access to global credit markets.
Despite the rapid increase in supply, the firm said overall market conditions remain stable, though bond pricing is increasingly being influenced by expectations of continued heavy issuance. The report also highlighted a growing shift in financing strategies among chipmakers, with more short-term deals being structured and repaid over time rather than long-dated financing arrangements.
As AI development continues to accelerate globally, the scale of capital required is reshaping credit markets, with debt becoming a central tool for funding the next phase of technological expansion.
