Microsoft is seeking to raise at least $25 billion through its first US investment-grade bond offering in more than nine years, according to Bloomberg, as major technology companies increasingly turn to debt markets to finance their artificial intelligence investments.
The final size of the offering has yet to be determined and could change depending on investor demand, people familiar with the matter told Bloomberg.
Microsoft shares pared their gains in premarket trading.
The software giant is marketing bonds in as many as 10 tranches, with maturities ranging from two to 40 years, according to the people, who requested anonymity because they were not authorized to speak publicly. Initial pricing discussions for the longest-dated notes, due in 2066, indicate a yield premium of up to 1.35 percentage points over US Treasuries.
Wells Fargo, JPMorgan Chase and UBS are managing the offering. Proceeds are expected to be used for general corporate purposes, including capital expenditures, according to the people cited by Bloomberg.
The sale would mark Microsoft's return to the US investment-grade debt market after a lengthy hiatus. The company last issued high-grade bonds in 2017, raising $17 billion through a seven-part offering, according to Bloomberg-compiled data.
Microsoft is one of only two publicly traded US companies holding top-tier AAA ratings from both Moody's Ratings and S&P Global Ratings, alongside Johnson & Johnson. The planned bond sale comes as technology companies ramp up borrowing to support the substantial spending required to build AI infrastructure.
