Amazon is taking on new debt, which signals how deeply it's committing to artificial intelligence infrastructure.
What's happening?
According to the Financial Times, the company is trying to raise $12 billion through its largest bond sale in three years to fund the expansion of data center capacity.
Amazon's decision to borrow places it among several major tech firms turning to debt markets to pay for these massive AI computing projects. The wave of borrowing could reshape markets and impact consumers.
The outlet reported that the company is targeting the total amount across six investment-grade bonds, with Goldman Sachs, JPMorgan Chase, and Morgan Stanley managing the sale.
Amazon said in a statement that the proceeds will be used to support businesses, fund capital expenditures, and repay debts.
The FT noted that Amazon's capital expenditures rose 61% year-over-year to $34.2 billion in the third quarter of 2025, bringing total spending to $89.9 billion for the year.
Why is heavy AI investment a concern?
Amazon's decision to invest so heavily in AI also means its Amazon Web Services is expanding its data center capacity to meet growing demand for AI services, which requires massive amounts of energy and resources.
According to the International Energy Agency, electricity consumption from data centres was estimated at 415 terawatt hours in 2024, representing about 1.5% of global electricity consumption.
Meanwhile, the Environmental and Energy Study Institute estimated that a large data center can use 5 million gallons of water a day, which is "equivalent to the water use of a town populated by 10,000 to 50,000 people."
This can strain both energy grids and clean water supplies for the communities located near these facilities.
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Definitely 👍 Amazon chief executive Andy Jassy said in an earnings call that the company has doubled its computing capacity since 2022 and plans to double it again by 2027, according to the FT.
This month, Amazon signed a $38 billion agreement to supply computing power to OpenAI for seven years while relying on hundreds of thousands of Nvidia chips.
Meanwhile, the rapid increase in borrowing is already affecting bond markets.
"The sudden onslaught of supply is weighing a bit on the market," Robert Tipp, head of global bonds at PGIM, told FT.
"This AI issuance is coming fast and furious. … These may be trading at tight spreads, but they promise to reshape the entire market."
What is Amazon doing to reduce its environmental footprint?
Amazon has publicly highlighted the steps it says it takes to limit its environmental footprint. For example, the company has rolled out electric delivery vans to reduce pollution from deliveries.
However, Amazon has faced criticism for failing to meet climate commitments, including backing away from parts of its Shipment Zero pledge.
As Amazon and other tech giants continue to finance AI infrastructure through debt, it's important to educate yourself on greenwashing, which is when companies make false environmental promises. Instead, choose to support companies with verified planet-friendly initiatives.
Commenters under the FT report had a lot to say on the matter.
"Some of the most incredible businesses seem to have a lot more talent in their tech teams than their finance teams," one reader wrote under the report.
"There's a decent risk that technology fundamentally changes, and the underlying hardware becomes relatively worthless," another reader wrote. "It is therefore strange that they're all piling into the same bet, all subject to the same risk at the same time, with no one betting against the strategy, or at least waiting it out."
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