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2026-11-02 18:22:27
[Alphabet Launches Eurobond Issuance, Tech Bond Demand Tested] ⑴ Alphabet launched a euro-denominated bond issuance on Monday to test investor demand following a sell-off in tech stocks and bonds and a shaken confidence in artificial intelligence (AI) deals. ⑵ This is Alphabet's second euro-denominated bond issuance this year; it previously issued €9 billion in bonds in May and, unusually, issued 100-year sterling bonds in February. ⑶ According to the bank memo arranging the transaction, the issuance will be divided into seven tranches with maturities ranging from two to 19 years, and pricing is expected later on Monday. ⑷ Market concerns about the financing and return on investment needed to support massive AI spending have dragged down tech stocks and bonds in recent weeks, with the Nasdaq falling 5% in October. ⑸ Recent increased volatility stems from disappointing quarterly results from Alphabet and Amazon, two major data center spenders. ⑹ However, analysts expect large tech companies to increase bond issuance in Europe to seek funding for infrastructure investments and take advantage of the region's deep and liquid debt market. ⑺ This transaction marks Alphabet's return to the European bond market; its May issuance included six tranches. (8) Alphabet shares rose about 1.3% in pre-market trading. Its U.S. stock fell nearly 19% in October, marking its worst monthly performance on record. Its 4.1% dollar-denominated bonds maturing in 2031 were essentially unchanged at about 95.43 cents on Monday.
