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Meta Platforms is selling US dollar bonds worth $15 billion, its first bond sale in the investment-grade market since April. Investors looking for higher returns have helped to drive demand for the bonds. The company intends to use the money to build data centers for its AI business.

A two-currency deal worth at least $20 billion

The dollar notes are one half of a cross-border offering that Meta expects to go over $20 billion. The second half is a euro-denominated bond, Meta’s very first of its type, which could hit the market on Thursday.

The bond sale includes five groups of dollar bonds, with repayment periods ranging from five to 30 years. Early pricing estimates ranged from 130 basis points above US Treasury rates for the five-year bonds to 250 basis points for the 30-year bonds. The seven-, 10- and 20-year bonds were all priced at 165, 185 and 230 basis points above Treasury rates, respectively.

Meta plans to use the money to expand its AI infrastructure. The cost of building these systems has led the company to borrow, despite its long history of funding investments with its own cash.

Appetite for AI debt has thinned since April, when Meta raised $25 billion and drew peak orders for the sale worth $96 billion.

Big Tech is flooding the bond market

Other big tech companies are also joining Meta in borrowing money. Oracle raised $10 billion on Tuesday, while Alphabet raised €6 billion (about $6.73 billion) by selling euro bonds, Yahoo Finance reported. Microsoft raised $25 billion last week, ending a nearly three-month break in bond sales by major tech companies.

Dealroom estimates that Alphabet, Meta, Oracle and Amazon have raised nearly $90 billion combined through bond sales since September.

The huge borrowing reflects how much money companies now need to compete in AI. Bloomberg Intelligence expects major cloud and AI infrastructure companies to spend nearly $4.5 trillion over the next three years.

But it is still unclear when they will start making all of this money back. Dealroom says Meta’s bonds now have the biggest gap between their yields and those of other highly rated corporate bonds since 2003. This suggests investors are becoming more cautious about how much more debt the market can handle.

Meta is also rolling out its latest AI model, Muse Wonder. Company executives say the latest model from the tech giant can match ChatGPT and Claude on coding and difficult financial and legal tasks.