The artificial intelligence borrowing boom is showing signs of slowing, with global AI-related debt issuance plunging nearly 80% from $113 billion in June to just $23 billion in September. Th
The artificial intelligence borrowing boom is showing signs of slowing, with global AI-related debt issuance plunging nearly 80% from $113 billion in June to just $23 billion in September.
The decline comes as banks struggle to distribute approximately $18 billion in loans connected to Oracle's massive New Mexico data center project, adding another warning sign to an industry that has spent much of 2026 raising record amounts of capital.
Investors are now questioning how quickly billions invested in AI infrastructure can translate into revenue, particularly as borrowing costs rise and construction delays threaten project economics.
AI Debt Issuance Drops Nearly 80% From June PeakAccording to Financial Times reporting, citing Morgan Stanley data, global AI-related debt issuance fell to $23 billion in September, less than half August's volume and substantially below June's $113 billion peak.
The slowdown was particularly visible in U.S. investment-grade bonds, where AI-related issuance stopped entirely in September after major technology companies borrowed approximately $306 billion between January and August.
However, the decline does not mean financing has disappeared. AI-related borrowing reached roughly $466 billion during the first nine months of 2026, reflecting how aggressively companies funded expansion earlier in the year.
Morgan Stanley attributed much of September's weakness to that earlier borrowing surge, although higher interest rates and growing scrutiny of data center economics have also complicated new financing.
Oracle's $18B Data Center Loans Trade at a DiscountOracle provides a concrete example of the pressure emerging in AI credit markets.
Approximately $18 billion in loans backing Project Jupiter, a New Mexico data center campus associated with Oracle's OpenAI infrastructure commitments, were quoted at just 89–91 cents on the dollar in September.
Banks including Santander and Jefferies reportedly struggled to distribute the loans as investors reassessed construction delays, Oracle's expanding debt burden and uncertainty surrounding the project's power infrastructure.
The financing difficulties followed S&P's July downgrade of Oracle to BBB-, the lowest investment-grade rating. The company's earlier Project Jupiter financing had already revealed how project-level debt could come under pressure despite enormous contracted demand.
Trading below face value does not mean Oracle has defaulted. It indicates that investors were demanding a discount to assume the exposure.
The situation also reflects a broader problem for AI infrastructure stocks, where high revenue expectations must eventually cover financing expenses and capital expenditure.
