Moody’s warns AI spending is pressuring credit quality at major tech firms

Moody’s Ratings said the rapid expansion of artificial intelligence infrastructure is putting pressure on the credit profiles of large technology companies, including Amazon, Meta, Alphabet, Microsoft, Oracle and CoreWeave. The firm said the scale of AIrelated capital spending is reducing free cash flow and increasing balancesheet risk as companies fund data centers, chips and other physical infrastructure. Moody’s estimated that spending on this buildout could reach $785 billion in 2026 and approach $1 trillion in 2027. To finance the surge, some companies are relying more on debt, equity sales and longterm lease commitments. Moody’s said these obligations can act like debt even when they are kept off the balance sheet. The report also noted that AI partnerships and customer relationships are becoming more circular, with major cloud providers investing in AI labs that also spend heavily on their services.