The 100-Year Bet

Alphabet's bond offering last week was not just large. It was historic. The Google parent raised $31.51 billion in a global debt sale that included something rarely seen in corporate finance: a 100-year bond. The century note, denominated in sterling, locks in 6.125% interest until 2126.The immediate purpose of Alphabet's borrowing is to fund $175 to $185 billion in capital expenditure this year, nearly all of it directed toward artificial intelligence infrastructure. Add up the spending plans from Amazon, Microsoft, and Meta, and the four largest hyperscalers are on track to deploy roughly $650 billion in 2026.The scale of this investment is difficult to absorb. $650 billion is roughly equivalent to the annual GDP of Switzerland. And unlike previous technology buildouts, this one is being funded largely with debt.Technology companies have traditionally avoided borrowing. The largest tech firms generated so much cash that debt seemed unnecessary. That era is ending. The capital requirements for AI infrastructure have grown so large that internal cash flow cannot keep pace.Debt has become the tool of choice to bridge that gap. Unlike equity issuance, which dilutes shareholders, debt allows companies to lock in funding without disturbing ownership structures. Alphabet's 100-year bond solves a genuine problem: matching long-dated liabilities to long-dated assets.