After the new bond sale, Amazon is borrowing $17.5 billion from banks as it continues to spend on artificial intelligence

Companies are spending exorbitant amounts of money to keep up with the AI ​​arms race. Debts are rising. Amid this wave of activity, Amazon signed a deal to borrow about $17.5 billion from a number of financial lenders. According to Bloomberg.

The banks are behind the loan It is said They include Citigroup, JPMorgan Chase, Wells Fargo, HSBC and Bank of America Securities. The deal was described as a Delayed withdrawal of the term loanWhich means Amazon can withdraw funds on its own schedule rather than taking the entire amount upfront, giving it flexibility in how and when it distributes the funds.

The loan comes just two days after it was announced that Amazon would do so as well Raised $14 billion from selling Canadian bondsBringing its total new financing to approximately $31.5 billion in approximately 48 hours.

It’s not clear exactly how Amazon plans to spend all the new money. Reuters He notices it The new loan will be used for “general corporate purposes.” TechCrunch has reached out to Amazon for more information.

Amazon is not alone. To fund new AI infrastructure such as chips and data centers, companies are leveraging historical capital expenditures. Increasingly, companies They borrow money To finance massive AI build-outs. The question investors and analysts are increasingly asking is not whether such spending is necessary, but whether the returns will justify it at all.

The scale of borrowing is staggering even by Silicon Valley standards. About a week ago, Alphabet, Google’s parent company, said so It plans to raise $80 billion Through a stock sale designed to help “finance its investments in a balanced manner while maintaining a healthy balance sheet.” Meta also announced plans to Raised $30 billion from bond sales -The biggest ever.