Microsoft taps debt markets with $25B bond sale to boost AI

Microsoft (MSFT) priced $25B in senior unsecured debt on Thursday, launching a massive ten-tranche bond offering to fund capital expenditures, stock buybacks, and general corporate purposes.

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Microsoft intends to use the net proceeds from the offering for general corporate purposes, which may include, among other things, funding for working capital, capital expenditures, repurchases of capital stock, acquisitions, and repayment of existing debt.

The offerings are expected to close on November 4, 2026. The software maker holds a top-tier AAA rating with S&P, a credit agency.

Microsoft will access additional funding sources to complement its cash flow generation when conditions are attractive, Amy Hood, its finance chief, said on the company’s earnings call on Wednesday.

“There’s a form of financing called leasing, and we’ve been using that one as a vehicle,” she said. “We’re fortunate to have access in the debt markets, given where our ratings are, and we haven’t yet tapped that.”

The offering comes as Oracle (ORCL) too, unveiled plans to raise capital on Wednesday and said it anticipates a return to positive free cash flow in the second half of its 2028 fiscal year.

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