Amazon Raises $5.76 Billion in First-Ever Sterling Bond Sale

Amazon has raised £4.25 billion ($5.76 billion) through its first-ever sterling bond sale, expanding the technology giant's borrowing into the UK market as hyperscalers ramp up spending on artificial intelligence infrastructure. The four-part transaction attracted more than £10.65 billion in final investor demand, according to one of the lead managers.

The deal is split across bonds maturing in three, six, 12 and 19 years. Amazon will raise £1.25 billion through the three-year notes and £1 billion from each of the other three maturities. Yields range from about 5.2% for the three-year bonds to 6.7% for the 19-year securities.

Amazon Expands Its Global Debt Strategy

The sterling transaction gives Amazon another currency in which to raise long-term funding. The company has already tapped the euro, Swiss franc and Canadian dollar bond markets, reflecting the growing need among major technology companies to diversify their sources of capital.

Amazon's latest borrowing comes after it appointed banks on Tuesday to arrange its first sterling transaction. Initial guidance had placed the spreads at roughly 70 basis points over UK government bonds for the three-year notes, 90 basis points for the six-year notes, 105 basis points for the 12-year bonds and 110 basis points for the 19-year issue.

AI Infrastructure Drives Borrowing

The bond sale is part of a much larger funding trend among hyperscalers. Amazon, Microsoft, Alphabet, Meta and other technology companies are spending heavily on data centres, computing equipment, networking infrastructure and electricity capacity needed to support increasingly demanding AI workloads.

According to LSEG data cited by Reuters, hyperscalers have issued more than $200 billion of debt in 2026, already more than twice the amount issued during the whole of 2025. The scale of that borrowing has increased scrutiny over whether investors can continue absorbing such large volumes of technology-company debt.

Amazon's own capital requirements have been growing alongside its AI ambitions. The company has been investing heavily in AWS infrastructure and developing its AI services, while also expanding its data-centre footprint to support growing demand from customers using generative AI.

Investor Demand Remains Strong but Is Cooling

Amazon's sterling offering was comfortably oversubscribed, with final demand of more than £10.65 billion against the £4.25 billion being raised. That represents roughly 2.5 times the amount of debt ultimately issued.

However, the level of demand was considerably lower than the response to Alphabet's first sterling bond sale in February. Alphabet raised £5.5 billion through a five-part transaction, including a rare 100-year bond, and attracted demand equivalent to roughly five times the amount offered.

The difference has raised questions about whether investors are becoming more selective as technology companies repeatedly return to debt markets. Gordon Shannon, a partner at TwentyFour Asset Management, told Reuters that the weaker demand compared with Alphabet's deal showed that investor appetite for hyperscaler borrowing is not unlimited.

Hyperscalers Face Rising Financing Pressure

The rapid increase in technology-sector borrowing is beginning to affect the broader bond market. The European Central Bank warned earlier this month that heavy borrowing by hyperscalers could crowd out other companies and potentially push up financing costs.

Amazon's July bond sale had already attracted weaker demand than some of its previous offerings. The latest sterling transaction therefore comes at a time when investors are assessing not only the credit quality of individual technology companies but also the sheer volume of debt being issued to finance AI infrastructure.

For Amazon, borrowing in sterling provides access to another pool of institutional investors and reduces its reliance on a single currency market. For investors, however, the growing supply of hyperscaler debt creates more choices and could increase pressure on companies to offer attractive borrowing terms.

Amazon's £4.25 billion transaction shows that investors are still willing to provide substantial financing to the technology sector, even as borrowing accelerates. But the lower demand multiple compared with Alphabet's earlier sterling deal suggests that the market may be becoming more discerning as the AI investment cycle drives an unprecedented wave of corporate debt issuance.