Nvidia Returns to Bond Market for $25 Billion, Testing AI Investor Appetite

Nvidia is selling $25 billion in investment-grade bonds Monday, its first debt offering since 2021 and a clear signal of how the AI boom is reshaping corporate finance. The chipmaker initially planned a $20 billion issuance, but upsized after orders surged past $85 billion by early afternoon in New York, according to sources familiar with the deal.

The seven-part offering spans maturities from two to 30 years. Strong demand has already compressed yields: the 10-year tranche is now expected to pay just 0.5 percentage points above US Treasuries, down from an initial 0.75 percentage points. Favorable market conditions following the US-Iran deal are allowing Nvidia to borrow cheaply, said Lauren Wagandt, a portfolio manager at T Rowe Price. "It's a very high-quality company, and it doesn't come to the market as often as other tech names," she noted.

Nvidia, the biggest beneficiary of Big Tech's trillion-dollar AI infrastructure spending spree, said it will use proceeds for general corporate purposes, including refinancing existing debt. The offering is at least three times larger than its last bond sale in 2021, when it raised $5 billion. Once completed, Nvidia's total debt outstanding will more than triple to roughly $30 billion, up from $8.5 billion.

The deal comes as tech companies race to secure funding amid an intensifying AI arms race, and as Wall Street faces a flood of new equity and debt - including SpaceX's record $75 billion IPO. For investors, Nvidia's return to the bond market offers a rare, high-quality entry point into the AI sector's financial engine.

Source: Ars Technica