Amazon bond demand tops £11 billion in sterling debut

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Amazons sterling-market debut

Highlights

Amazon plans to raise £4.25 billion in sterling.
Investor orders exceeded £11.65 billion.
The company has issued over $92 billion of bonds in 2026.
The sale marks Amazon's sterling-market debut.

Orders had earlier surpassed £12 billion before easing, while pricing was tightened as the transaction progressed, Bloomberg reported. The three-year tranche was being offered at 53 basis points over U.K. government bonds, while the longest-dated portion was set at 93 basis points over gilts.

Amazon broadens its funding base

The sterling transaction marks Amazon's fourth move outside the U.S. dollar bond market this year as large technology companies seek a wider range of investors to finance rising capital requirements.

Amazon entered the euro market for the first time in March with what became the largest corporate bond transaction ever denominated in the currency. It subsequently issued a record six tranches in Swiss francs and completed the largest corporate debt offering in Canadian dollars.

Those deals have helped push Amazon's bond issuance above the equivalent of $92 billion in 2026, placing it ahead of other hyperscale technology companies.

The company is following a path also taken by Alphabet, whose expanding AI investments have prompted it to seek funding across international debt markets. The Google parent raised £5.5 billion in sterling bonds in February, attracting almost £30 billion of orders, and later borrowed in Australian dollars and Japanese yen.

AI spending tests bond demand

The scale of technology-sector borrowing is becoming a more important issue for credit investors. Heavy spending on AI infrastructure has driven repeated debt issuance from hyperscalers, increasing the amount of technology-company paper that bond markets must absorb.

Demand for Amazon's sterling offering remains substantial at more than twice the planned deal size. The U.K. market also has relatively limited supplies of bonds from large technology companies, helping distinguish the transaction from more crowded parts of the global credit market.

At the same time, signs of investor resistance are emerging. Some recent AI-related bond offerings have attracted weaker demand and required issuers to pay higher borrowing costs than transactions completed earlier in the year.

Amazon's £4.25 billion sale therefore provides another test of how far global debt markets can support the financing requirements created by the AI investment cycle. JPMorgan, Barclays, HSBC, and NatWest are managing the transaction, which is expected to be priced Wednesday.

As we previously reported, Amazon to shut down Mechanical Turk after 21 years.

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