U.S. corporate bond issuance is expected to increase substantially in 2026, driven by the significant build-out needs of AI hyperscaler companies. While M&A activity and corporate refinancing will contribute to overall issuance, Barclays analysts highlight AI-related funding as the primary driver. They forecast total U.S. corporate bond issuance to reach $2.46 trillion in 2026, an 11.8% increase from $2.2 trillion in 2025. Net issuance is projected to rise to $945 billion, a 30.2% jump from $726 billion the previous year.
According to Barclays, this upswing is largely due to non-financial factors, with AI hyperscaler capital expenditure posing the biggest upside risk, potentially requiring more large public deals than usual. These AI companies, including Amazon, Alphabet (Google), Meta, Microsoft, and Oracle, are rapidly increasing both spending and borrowing to expand their data centre presence and processor capabilities. BofA Securities reported that these five major AI hyperscalers issued $121 billion in U.S. corporate bonds last year, a stark contrast to the average of $28 billion per year between 2020 and 2024.
BofA analysts anticipate this borrowing trend to accelerate, projecting approximately $140 billion in annual borrowing by the Big Five hyperscalers over the next three years, potentially exceeding $300 billion annually. This level would position them alongside the Big Six banks, which are expected to average $157 billion in issuance annually. MUFG analysts noted that hyperscalers accounted for four of the five largest U.S. high-grade bond deals in 2025, particularly in the latter half of the year.
The surge in hyperscaler borrowing has impacted credit spreads, prompting investors to increasingly utilise credit default swaps (CDS) to hedge against AI-related risks. For example, Oracle, a company chaired by Larry Ellison which provides enterprise information technology solutions, sold $18 billion in bonds in September. The cost to insure hyperscaler debt through CDS has risen since June 2025, with Oracle’s five-year CDS more than tripling since its September bond sale.
