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Microsoft borrows $25B in first bond sale since 2017 to fund AI and capital spending despite large cash reserves

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30 Oct 2026, 15:12 WIB
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Neutral
Microsoft borrows $25B in first bond sale since 2017 to fund AI and capital spending despite large cash reserves

Microsoft issued $25 billion in senior unsecured bonds, its first U.S. dollar bond sale since 2017, to support its AI-driven investments and capital expenditures. Despite holding $64.5 billion in cash, the company chose to borrow to maintain liquidity for share buybacks and construction amid rising spending, expecting about $175 billion in capital expenditures for 2026. The bond sale was highly oversubscribed, reflecting strong investor confidence in Microsoft's creditworthiness. Future stock performance may hinge on Microsoft's ability to sustain Azure growth and manage spending without impacting its AAA credit rating.

Microsoft's bond issuance to fund AI investments comes as its stock trades near the upper end of its 52-week range, priced at USD 527.32 compared to a high of USD 543.45 and a low of USD 352.83 on Pluang as of Oct 30, 2026 19:21 WIB. Despite a slight 0.53% dip in one day, the market cap remains robust at $3.94 trillion. The platform shows a higher sell activity at 73%, indicating cautious investor sentiment even as Microsoft maintains a solid dividend yield of 0.74%.

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