JPMorgan Chase & Co. warns of rapidly increasing AI industry costs. These costs are emerging in the corporate bond market. Bank strategists note a structural shift: large technology firms now borrow heavily for AI development, moving away from sole reliance on operating cash flow.
In 2025, the five largest hyperscale companies issued about $121 billion in corporate bonds. This marks a dramatic increase from the $28 billion annual average between 2020 and 2024. AI-related debt now constitutes approximately 15% of the entire corporate bond universe. J.P. Morgan Asset Management views these companies as financially strong. However, it warns of growing concentration risk for the bond market.