AI Bond Frenzy Cools! Meta Data Center Bond Yield Hits 7.53%, Subscription Ratio Halved Like Amazon to Just 1.6x

Latest data shows the 'scramble' for AI infrastructure bonds is quickly fading. BlackRock issued a $12.5 billion bond on Monday (27th) for Meta's 1GW Texas data center project, pricing the yield at 7.53%, approximately 2 percentage points higher than the average for similarly rated A/AA bonds. This is one of the highest yields for blue-chip data center bonds since last year's AI financing boom.

Demand appears even weaker, with order peaks reaching only about $20 billion and a subscription ratio of 1.6x—far below the average of around 4x for large U.S. AI-related investment-grade bond issuances this year—marking the lowest level for such deals. The bond was arranged by JPMorgan and Morgan Stanley, with proceeds funding Meta and BlackRock's jointly built Texas project (total cost around $14 billion). Meta will sign a 20-year lease starting in 2028 to support debt repayment.

Since last year, global AI-related debt financing has exceeded $570 billion, pushing credit markets' absorptive capacity to its limits.

CDS (credit default swaps) for Meta, Alphabet, Oracle, and SpaceX have recently surged, as banks and institutions increase hedging against the risk of 'infrastructure completed but returns falling short of expectations.'

Amazon's new AI bond issuance in early July also saw its subscription ratio drop from 3.4x in March to 1.6x, mirroring the BlackRock deal.

The market isn't rejecting AI bonds—it's re-evaluating risk. Investors are willing to buy, but only with sufficient yield spreads. A 7.53% yield is approaching the boundary between investment-grade and junk-grade bonds, signaling that AI financing has moved from 'narrative premium' to 'risk-based pricing.' Upcoming massive data center bond issuances will either need to offer higher yields or rely more on equity funding.