Bank of America has increased its forecast for investment-grade bond issuance by so-called "hyperscale cloud providers" in 2026 by 25% to $175 billion, while maintaining its expectation of $65 billion in new debt issuance for this year. The bank's analyst, Tom Curcuruto, stated in a report to clients last Friday that the upward revision was primarily due to Amazon's completion of a $54 billion bond sale following its investment announcement in OpenAI last week, a transaction not included in the bank's previous forecast. He noted, "We anticipate approximately $65 billion in additional issuance for the remainder of 2026. If this peak period of concentrated bond sales has passed, it would be positive for credit spreads."

Hyperscale cloud service providers are large cloud computing enterprises that heavily invest in computing power and infrastructure to support artificial intelligence (AI) development. These companies have already issued $110 billion in investment-grade bonds in 2026, accounting for 63% of Bank of America's latest forecast. The bank expects Meta, Microsoft, and Google to issue approximately $30 billion, $20 billion, and $15 billion in bonds respectively within the year, with about a quarter of these bonds denominated in foreign currencies.

Technology companies are significantly spending on AI computing facilities, heavily relying on debt markets for funding, raising market concerns about whether this wave of tech capital investment will foster future growth or create a speculative bubble. In 2026, hyperscale cloud providers' spending in the data center sector is projected to increase by approximately 70% year-over-year, surpassing $600 billion.

Last week, Amazon issued $37 billion in bonds in the U.S. market and €14.5 billion in bonds in the European market, setting a record for corporate bond issuance in Europe. In the U.S. market alone, asset management firms placed subscription orders totaling $126 billion. Curcuruto suggested that further revisions to the bond issuance forecasts for hyperscale cloud providers will depend on the new capital expenditure plans disclosed in company earnings reports from late April to early May. He indicated that after accounting for stock buybacks and dividends, corporate capital expenditures are approaching pre-capital expenditure cash flow levels. If cloud giants further raise their spending guidance, it will directly impact future bond issuance volumes.

Additionally, Bank of America specifically mentioned that Oracle has maintained its capital expenditure forecast for 2026 and stated that it will achieve "decoupling of spending and demand" by 2027, a stance viewed as "favorable" for its future bond issuance.