Microsoft’s stock slid 0.7% in afternoon trading after the company disclosed plans to issue a $25 billion investment‑grade bond in the U.S., its first such sale in more than nine years.
Bloomberg reports that the offering has already attracted over $100 billion in orders—more than four times the size of the proposed issue—making it one of the most oversubscribed tech debt issuances seen in 2024.
The deal will be structured in up to ten tranches, with maturities ranging from two to forty years, and is being managed jointly by Wells Fargo, JPMorgan Chase and UBS Group AG.
The move follows a broader trend of big‑tech giants tapping the bond market to fund their AI and data‑center spend, a shift from relying solely on internal cash reserves.
CFO Amy Hood told investors on Thursday that Microsoft would pursue additional funding sources when it deems them attractive, underscoring the company’s intent to preserve cash flow and financial flexibility.
Despite the dip, analysts note that Microsoft still projects positive free‑cash‑flow for the fiscal year ending June 2027, a stark contrast to peers that are burning through capital.
The bond sale could pave the way for further capital‑raising, with Microsoft likely to revisit its funding strategy as its AI ambitions scale.