A broadening range of AI-related credit instruments means there are multiple ways to provide capital to the same underlying companies. But structures and spreads vary significantly
Source: Bloomberg, ICE BofA and JPMorgan. August 2026.
Last year, we commented on a wave of bond issuance as ‘hyperscaler’ tech companies turned to credit markets to fund spending on AI data centres. Today, many other AI-related borrowers – such as data centres and cloud providers (Neoclouds like CoreWeave) – are tapping credit markets in a variety of ways. Crucially for investors, the complexity of some of these instruments is resulting in good value for taking similar underlying earnings risk.
The chart shows a variety of AI-related credit instruments and their current spreads, with several broader credit indices also included for comparison. It reveals both dispersion within the AI theme and a material spread pick-up relative to broader credit indices, with structures rated BBB (investment grade) and BB (high yield) offering more spread than comparable indices.
The AI theme in credit markets is evolving rapidly and extending far beyond bond issuance from hyperscalers. As new financing packages are often more complex in nature or ineligible for mainstream index inclusion, they provide better compensation for risk but require careful diligence.
Credit investors with the ability to navigate this complexity and the freedom to invest dynamically and without index constraints are at an inherent advantage.
