Rising Treasury Yields Spark Concerns Over AI Company Debt Burden

With Treasury yields reaching their highest levels since 2007, companies reliant on debt are facing increased borrowing costs. This means that the AI infrastructure buildout, which has already reached historic levels, is about to get even more expensive.

JPMorgan Chase estimated in June that $4.1 trillion in AI-related debt will be issued through 2030. Companies like data center operators and others tied to the AI boom are racing to build up capacity to meet what many industry experts view as insatiable demand for AI services.

So far, companies have been willing to absorb higher debt costs, but some investors are starting to worry about future financings.