Amazon.com Inc., the e-commerce and cloud computing giant, has entered the U.S. corporate bond market with a significant debt issuance on Monday, signaling its return after a roughly three-year hiatus from such deals.
This move comes amid a favorable environment for high-grade issuers, as corporate borrowing costs remain relatively low despite ongoing economic uncertainties.
Sources familiar with the transaction, speaking on condition of anonymity due to the private nature of the discussions, indicate that Amazon is structuring the offering into up to six tranches, catering to a range of investor appetites for duration and yield.
The centerpiece of the deal is a landmark 40-year bond, with initial pricing guidance set at approximately 115 basis points above comparable U.S. Treasuries.
This spread reflects Amazon’s strong credit profile and robust investor demand in the investment-grade sector.
The issuance underscores Amazon’s ongoing strategy to bolster its balance sheet for expansive capital expenditures, particularly in data centers and AI infrastructure, as the company ramps up investments in its AWS cloud division.
While the total size of the offering has not been finalized, market observers anticipate it could approach or exceed $10 billion, based on patterns from prior Amazon bond sales.
This is Amazon’s first foray into the U.S. dollar-denominated corporate bond market since 2022, when it raised billions to fund acquisitions and share repurchases.
The timing aligns with a broader resurgence in corporate debt activity, as issuers take advantage of yields that, while higher than pre-pandemic levels, offer attractive funding costs compared to equity dilution.
Bond traders and analysts are closely watching the final pricing and allocation, expected later this week, as it could set benchmarks for other tech-heavy issuers.
Amazon’s bonds, rated Aaa by Moody’s and AA+ by S&P, continue to be viewed as near-Treasury equivalents in terms of safety, driving strong oversubscription in past offerings.
Investors can track live pricing through major bond platforms for real-time developments.