Mastodawn

Why does Amazon, a company valued at two and a half trillion dollars, need to borrow 17.5b from banks for Ai? I saw a quote yesterday - "The entire US economy right now is just 7 companies sending a trillion fake dollars back and forth to each other."

Fresh off bond sale, Amazon borrows $17.5B from banks as Ai spending continues

https://techcrunch.com/2026/06/10/fresh-off-bond-sale-amazon-borrows-17-5-billion-from-banks-as-ai-spending-continues/

Fresh off bond sale, Amazon borrows $17.5B from banks as AI spending continues | TechCrunch

Companies are burning through exorbitant sums of money to keep pace in the AI arms race. Debt is climbing.

TechCrunch

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AJ Sadauskas 3d ago

@TheBreadmonkey All up, Amazon borrowed ***US$31.5 billion*** in 48 hours, including both bonds and loans, from some of the world's biggest banks.

So what happens if Amazon can't pay the money back?

From the article:

"Companies are burning through exorbitant sums of money to keep pace in the AI arms race. Debt is climbing. Amidst this flurry of activity, Amazon has signed a deal to borrow some $17.5 billion from a number of financial lenders, according to Bloomberg.

"The banks behind the loan reportedly include Citigroup, JPMorgan Chase, Wells Fargo, HSBC, and BofA Securities. The deal has been characterized as a delayed draw term loan, meaning Amazon can draw down the funds on its own timeline rather than taking the full sum upfront, giving it flexibility in how and when the money gets deployed.

"The loan comes just two days after it was reported that Amazon would also raise $14 billion in a Canadian bond sale, bringing its total new financing to roughly $31.5 billion in the span of roughly 48 hours."

https://techcrunch.com/2026/06/10/fresh-off-bond-sale-amazon-borrows-17-5-billion-from-banks-as-ai-spending-continues/

#AIbubble #Amazon #ChatGPT #LLM #OpenAI #Anthropic #Gemini #Copilot #AI

Fresh off bond sale, Amazon borrows $17.5B from banks as AI spending continues | TechCrunch

Companies are burning through exorbitant sums of money to keep pace in the AI arms race. Debt is climbing.

TechCrunch

Show thread

David Chisnall (*Now with 50% more sarcasm!*)3d ago

@aj @TheBreadmonkey

Amazon's market cap is $2.561 T, so issuing $31.5 B in new shares would have caused slightly more than 1% dilution. Their share price is down about 7% this week, so it looks as if the stock market has decided that taking on that much new debt was a worse choice than issuing more shares.

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MacCruiskeen

@david_chisnall @aj @TheBreadmonkey Amazon is also holding about $140 billion in cash and short-term investments, according to their financial statements. So, yeah, some money manager decided it was cheaper for them to borrow than to spend their own money. Businesses do this kind of thing all the time. But it means that even Amazon has finite resources--they can't realistically spend hundreds of billions without having any idea how that is coming back.

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AJ Sadauskas 2d ago

@maccruiskeen @david_chisnall @TheBreadmonkey Amazon Aldo reportedly has over $225 billion in short- and long-term debt, up from $150 billion a year earlier.

So previously debt roughly matched cash and short-term investments. Debt now significantly exceeds cash and short-term investments.

Analysts think there'll also be an equity sale *on top of* this debt:

"As of 31 March, Amazon’s total short- and long-term debt, including lease payments, exceeded $225 billion. A year earlier, that figure was closer to $150 billion.
...
"The company has said it plans to spend approximately $200 billion in capital expenditure in 2026, mainly on new data centres and chips. Q1 spending alone hit $43.2 billion, the highest among Big Tech. CreditSights also flagged Amazon as a candidate for a future equity sale, following Alphabet’s $84.75 billion offering last week."

https://thenextweb.com/news/amazon-17-5-billion-loan-citigroup-ai-spending

Amazon takes on $17.5 billion in new debt as AI spending pushes total borrowing past $225 billion

Amazon has agreed to a $17.5 billion delayed-draw term loan led by Citigroup, the latest in a borrowing spree fuelled by its race to build AI infrastructure. The cash is available through the end of September. Each draw has a three-year repayment window. JPMorgan Chase, Bank of America, HSBC, and Wells Fargo are among more […]

The Next Web