Microsoft plans to raise $25 billion through US bond issuance — Channel NewsAsia

Microsoft plans to raise about $25 billion through the sale of investment-grade bonds in the United States. This could be the company’s first such offering in the US in more than nine years, Channel NewsAsia reports, citing Reuters and a source familiar with the matter.

Offering terms

According to Bloomberg, Microsoft may issue up to ten tranches of debt securities with maturities ranging from two to 40 years. No final decision on the size of the offering has yet been made: it may change depending on investor demand.

According to Bloomberg, the arrangers of the offering are Wells Fargo, JPMorgan Chase and UBS Group. UBS and Wells Fargo declined to comment to Reuters, while JPMorgan did not immediately respond. Microsoft referred Reuters to a regulatory filing that confirms the bond issuance but does not disclose its size.

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Additional financing

The bond sale could make Microsoft the latest major technology company to raise funds in the debt market to finance spending on artificial intelligence. The largest technology companies have also sold bonds and raised equity capital for such spending over the past year.

On the eve of the offering, Microsoft Chief Financial Officer Amy Hood told investors that the company would consider additional sources of financing when it considers them attractive. According to her, this is necessary to preserve cash flows and financial flexibility. Microsoft expects positive free cash flow in the current fiscal year, which ends in June 2027.