Google-owner Alphabet (GOOG) is moving deeper into global credit markets with plans for a rare 100-year sterling bond as part of a sweeping multi-currency debt programme. This cash call highlights how the AI arms race is reshaping big tech capital strategies.
The century bond, an ultra-long maturity instrument seldom used by corporations, is expected to sit alongside dollar and Swiss franc bonds as the company raises billions of dollars to support escalating investment in data centres, chips and AI models. Additionally, the transaction marks the first technology sector century bond issuance in decades. It also underscores a generational structural shift toward infrastructure-heavy spending across hyperscale cloud providers.
Alphabet has already sold $20 billion of US dollar bonds, upsized from an initial $15 billion after strong demand. Moreover, sterling and Swiss franc tranches form part of a broader diversification strategy aimed at expanding its investor base and lowering funding costs.
AI spending driving financing shift
The debt issuance reflects a new reality for a technology sector once characterised by asset-light software models. The shift means leading platforms are now deploying capital at industrial scale to build AI infrastructure.
Alphabet is expected to spend up to roughly $185 billion on capital expenditures this year. Much of it will be directed toward AI compute capacity and cloud expansion. Industry-wide, hyperscalers, including Amazon (AMZN), Meta Platform’s (META), Microsoft (MSFT) and others are forecast to borrow hundreds of billions of dollars to support similar initiatives. Consequently, this signals a sustained increase in leverage across the sector.
Who’s spending what on AI
Source: Company guidance
Investor appetite for the ultra-long debt appears strong, according to reports. In fact, orders for the century bond have been reported at multiples of the deal size. This reflects demand from pension funds and insurers seeking long-duration assets to match liabilities.
Why a century bond, and why sterling?
Century bonds remain rare in corporate finance and particularly unusual in technology. Historically, only a handful of major corporates and institutions have issued them. These include IBM (IBM) in the 1990s and select non-corporate sterling borrowers such as the University of Oxford and Wellcome Trust.
Alphabet’s choice of a multi-currency approach reflects several strategic goals:
- Investor diversification: Accessing sterling and Swiss markets broadens the pool beyond US credit investors.
- Funding optimisation: Sterling yields can be lower than comparable dollar issuance, improving overall borrowing costs.
- Supply management: Spreading issuance across currencies helps avoid saturating a single market and pushing yields higher.
Risks and market implications
Despite strong demand, ultra-long bonds carry significant risks for investors, including interest rate volatility, long-term credit uncertainty and potential technological disruption over a century-long horizon.
For Alphabet, however, this looks like a smart capital strategy, taking advantage of relatively low funding costs during a once in a generation infrastructure build out. It also signals Alphabet’s confidence in its own long-term cash generation. Furthermore, it reinforces a broader shift.
If repeated across the sector, it could change how big tech firms access large-scale debt finance to fund AI infrastructure. This would reshape balance sheets, investor expectations and valuations for years to come.
Can UK retail investors get involved?
Yes, UK investors can buy Alphabet’s debut sterling-denominated bonds, which are being issued this week (starting 9 February. However, the 100-year bond will be of little interest to UK retail investors given the long duration, significant interest rate risk, and difficulty trading corporate bonds mid-term.
However, Alphabet is offering different tranches in sterling, with maturities ranging from three to 32 years, plus the landmark 100-year bond. The books are being run by Goldman Sachs, Bank of America, JPMorgan and NatWest. Pricing details are expected this week.
Investors in the UK typically have three main ways to access these corporate bonds:
- Direct purchase through a platform: Major UK platforms often provide access to corporate bonds listed on the London Stock Exchange.
- Corporate bond ETFs/funds: Many UK retail investors prefer investing through sterling corporate bond funds or ETFs, which may add these new Alphabet bonds to their portfolios to provide diversified exposure.
- Access Bonds Initiative: Recent regulatory changes in the UK (effective 19 January 2026) aim to make corporate bonds more accessible to retail investors by allowing the opportunity to participate in a wider range of bonds from as little as £1.
This development broadens market participation, allowing more individuals to diversify their portfolios and access opportunities that were previously limited to institutional investors.
You can read the LSE’s announcement here.
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