UBS Updates Forecast for Big Tech Bond Sales

Swiss financial institution UBS has raised its forecast for bond sales by major U.S. technology companies in 2026, citing increased spending plans on infrastructure and artificial intelligence (AI) projects. This reflects a stronger outlook for investment-grade debt issuance from the technology sector, which has become a major driver in the broader corporate bond market.

Revised Forecasts for Investment Grade Bond Sales

According to a report published on February 18, 2026, UBS analysts updated their 2026 forecast for investment grade bond sales by large U.S. tech companies to $360 billion, up from an earlier projection of $300 billion. This increase is largely due to expectations that tech firms will borrow more to finance capital expenditures (capex), especially for AI infrastructure like data centers and advanced computing equipment.

The revised tech-specific forecast contributes to a broader increase in UBS’s outlook for total U.S. investment-grade debt issuance, which the bank now expects to reach $1.8 trillion this year. Tech companies are expected to make up about 20 % of that total.

Factors Driving Bond Issuance Growth

Several major technology firms—including Meta, Amazon, and Alphabet—have announced significantly higher capital expenditure plans during their recent earnings reports. UBS noted that if these announced increases are realized, aggregate capex by so-called “hyperscalers” could approach $770 billion in 2026, around 23 % higher than previously expected. This would likely lead to an additional $40 billion to $50 billion in public debt issuance from these firms.

UBS’s analysts pointed out that this capex-driven debt issuance is part of a broader trend in which big tech companies are seeking to fund long-term investments through the bond markets rather than relying solely on internal cash flows.

Shift Toward Global Bond Markets

UBS also highlighted that U.S. tech companies are increasingly tapping bond markets outside the United States. For example, Alphabet recently completed a major multi-currency bond issuance, raising funds in Swiss francs (CHF) and British pounds (GBP) in addition to U.S. dollars. This move suggests that technology firms are diversifying their borrowing sources and may continue to issue debt globally.

Issuing bonds in multiple currencies can give corporations access to broader investor bases and potentially benefit from favorable funding costs in different markets. UBS expects this trend of increased non-U.S. dollar bond issuance in the tech sector to continue.

Market Context: Tech Stocks and AI Spending

While UBS’s bond issuance forecast has been strengthened, many major technology stocks have seen downward pressure in early 2026. Investors have expressed concerns about whether heavy AI spending will generate sufficient returns to justify high valuations in equity markets. Despite this, bond investors seem more confident in the creditworthiness of these companies, at least in the near term.

This divergence between bond and stock market sentiment shows that corporate debt markets are still pricing tech companies as reliable borrowers, even if equity prices remain volatile. Investors continue to assess the long-term impact of AI-driven business transformation on earnings and profit margins.

UBS Lowers Leveraged Loan Forecast

In contrast to the upward revision for investment-grade tech bonds, UBS reduced its forecast for U.S. leveraged loan issuance for 2026 from $450 billion to $360 billion. The bank cited concerns that disruption from AI and related technological shifts could increase risk and reduce supply within leveraged loan markets.

UBS analysts explained that leveraged loans, which are typically issued by companies with weaker credit ratings than investment-grade borrowers, may face wider spreads and reduced refinancing activity if AI-related risks are underpriced.

Implications for Investors and Markets

The revised forecasts underline the central role that debt markets play in funding technology growth strategies. As tech firms invest in AI, data centers, and other long-term projects, they are turning to bond markets as an essential source of capital.

For investors, this could mean continued opportunities in the investment-grade corporate bond space, particularly for high-quality issuers with strong balance sheets. However, the broader credit markets—especially leveraged loans—may experience more caution as risks evolve.

Looking Ahead

UBS’s updated projections highlight how major technology companies are adapting their financing strategies in response to both internal investment priorities and external market conditions. The bank’s forecasts reflect a complex interplay between corporate spending plans, investor confidence, and broader macroeconomic trends.

As 2026 progresses, market participants will continue to watch how tech debt issuance trends compare with UBS’s predictions and whether broader conditions—such as interest rate expectations and economic growth—affect the pace of corporate borrowing.

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