Amazon, Meta, Alphabet, Microsoft, and Oracle are tapping the debt market for investing in artificial intelligence (AI)
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Several big tech companies in the United States are tapping the debt market for investing in artificial intelligence (AI). These companies include Amazon, Meta, Alphabet, Microsoft, and Oracle. Alongside artificial intelligence, the aim is to invest in cloud infrastructure.
What’s happening?
The tech giants are raising debts of almost $100 billion to invest in artificial intelligence and cloud infrastructure. The companies have almost doubled their investment amounts from last year. Some have even spent $400 billion on data centres.
What does it mean?
The increased demand for artificial intelligence, cloud infrastructure systems, machine learning, and data-heavy applications has emerged over the last few months. This puts the tech companies at the stake of having to invest in the infrastructures for adapting to what’s emerging.
Which companies are investing?
Amazon is planning to raise $15 billion, Oracle $18 billion, Verizon $11 billion, Alphabet $17.50 billion, and Meta $30 billion.
However, there are some risks to this. If AI hype dilutes over time, or returns don’t meet expectations, the heavy debt loads may become concerning for these companies.
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