(Aug 6): Alphabet Inc is looking to raise as much as US$25 billion from its latest US investment-grade bond offering, a deal that will test investor appetite for AI-related debt following a July selloff.

No final decision has been made on the size, according to people familiar with the matter, asking not to be identified as they’re not authorized to speak publicly.

The Google and YouTube parent is offering notes in as many as 10 parts, with maturities ranging from two to 40 years, a separate person said. Initial price talk for the longest-tenored tranche is a premium of about 1.55 percentage points above Treasuries.

Bank of America Corp, Citigroup Inc, Goldman Sachs Group Inc, JPMorgan Chase & Co, Morgan Stanley and Wells Fargo & Co are managing the sale, the person added. BofA and JPMorgan declined to comment while Alphabet and the other banks didn’t immediately respond.

Alphabet’s offering comes two weeks after the company’s raised 2026 spending outlook helped trigger fresh worries about whether massive artificial-intelligence investments will pay off. Investor appetite for bonds to help fund those expenditures cooled in July as Alphabet increased its forecast to as much as US$205 billion, more than double 2025’s outlays.

A BlackRock Inc-linked firm last week sold US$12.5 billion of bonds tied to a Meta Platforms Inc data center project in Texas. Initial demand was lackluster, following soft interest for an offering by Amazon.com Inc. Newly issued AI-related notes from firms including SpaceX saw spreads widen in the secondary market.

But the environment improved as August began, helped by gains in US Treasuries.

“We’ve had a few days now of positive reactions from investors across corporates and especially technology,” said Brett Kozlowski, portfolio manager at GW&K Investment Management. “But another large debt deal will still test the depth of that and be worth watching.”

Alphabet, which sold more than US$50 billion of debt in the first half of 2026, and Amazon have led the AI-infrastructure borrowing spree. Alphabet last tapped the US high-grade debt market in February, before selling bonds in Swiss francs, British pounds, euros, Canadian dollars and Japanese yen. It also issued nearly US$85 billion of shares two months ago.

Capital spending contributed to Alphabet posting its first quarter of negative cash flow since its 2004 initial public offering.

Uploaded by Lam Seng Fatt