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AI data centers are being financed through corporate bonds, bank construction loans, private credit, project-level borrowing, leases and equity. These are not interchangeable: a parent company’s debt, a developer’s secured notes and a tenant’s future lease payments may sit with different entities and appear differently in financial reports. Rising borrowing shows how the buildout is funded; on its own, it does not prove that the sector is in distress.
Why AI data center financing shows up in several places
A large facility can move through multiple financing stages, with different borrowers and lenders at each one. The OECD’s Global Debt Report 2026 describes corporate bonds as only one part of AI infrastructure financing. Banks commonly provide syndicated loans during construction; private credit can supplement that financing; and completed facilities may later be refinanced through single-asset, single-borrower asset-backed securities or private-placement bonds.
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- Corporate financing: A technology company raises bonds or equity and uses the proceeds for general corporate purposes, which may include infrastructure investment.
- Construction and project financing: A developer or project company borrows to build a specific site. Lenders may assess the project’s assets, construction plans and contracted revenue.
- Operating-stage financing: Once a facility is built and producing contracted cash flow, its owner may refinance the project.
- Leases and purchase commitments: A tenant or operator can agree to future payments for capacity, equipment or energy. Those obligations matter financially but are not automatically funded debt.
The OECD reported $59 billion in AI-related private-credit transactions in 2025 in its 2026 report. Its deal set uses Preqin’s “Artificial Intelligence” vertical, so the figure covers a broader AI category, not data-center loans alone. The report attributes the increase to larger deal values rather than a greater number of deals.
What counts as debt—and what does not
There is no single figure that captures all financing for AI data centers. Before comparing numbers, identify the borrower, instrument, reporting date and whether the amount is funded borrowing or a future contractual obligation.
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| Disclosure | What it represents | How to read it |
|---|---|---|
| Corporate bonds or loans | Borrowing by a parent company or operating subsidiary | Debt of that reporting entity. Proceeds may be for general corporate purposes rather than a named data center. |
| Project or construction debt | Borrowing by a developer, subsidiary or project company for a site or development | Check the collateral, recourse, maturity, covenants and any tenant contract supporting repayment. |
| Lease payments | Payments due under a lease, potentially including a lease that has not yet commenced | Future lease commitments are not the same as outstanding funded debt. Read the filing’s accounting category and timing. |
| Purchase commitments and other contractual obligations | Agreements to purchase equipment, infrastructure, energy or other services | These can require substantial future cash outlays, but should not be added to debt as if they were loans. |
| Equity issuance | Capital raised by selling common shares or equity-linked securities | It can fund the same expansion as borrowing, but it is not debt; equity-linked instruments can have their own terms and effects. |
What recent company disclosures show
The examples below illustrate distinct structures rather than a combined measure of industry debt. Their amounts have different dates, scopes and meanings.
| Company and date | Financing or obligation | What the disclosure establishes |
|---|---|---|
| Alphabet, June 30, 2026 | Corporate debt and separate future obligations | $98.2 billion in long-term debt carrying value; $85.2 billion in future payments on leases not yet commenced, primarily related to data centers; and $811.0 billion in purchase commitments and other contractual obligations. |
| Oracle, February 1, 2026 | Announced funding plan combining equity-related issuance and bonds | The company said it expected approximately half of its 2026 financing to come from equity-linked and common equity issuances and half from an investment-grade senior unsecured bond transaction. |
| Applied Digital, March 2026 | Senior secured project notes | Proceeds were intended to fund construction of 200 MW of critical IT load at Polaris Forge 2, leased to Oracle. The notes carry 6.750% annual interest and mature March 15, 2031, subject to the indenture. |
| Cipher Digital, lease agreed October 2025 | Long-term facility lease | The company described a 15-year lease with Amazon Web Services for approximately 300 gross MW of turnkey capacity at Black Pearl, with phased delivery expected to begin in 2026. |
| Nebius, July 17, 2026 | First senior secured debt facility | The AI-cloud company announced a facility of approximately $775 million and said it was significantly oversubscribed. The announcement does not establish that this is a data-center-only loan. |
Alphabet: debt is only one line in the financing picture
Alphabet’s Q2 2026 Form 10-Q reported $98.2 billion of long-term debt carrying value as of June 30, 2026. During the first half of 2026, it issued $20.0 billion of U.S.-dollar fixed-rate senior unsecured notes and $31.8 billion of foreign-currency fixed-rate senior unsecured notes, saying the proceeds were for general corporate purposes.
The same filing separately reported $85.2 billion of future payments for leases that had not yet commenced, primarily related to data centers. Alphabet expected those leases to commence between 2026 and 2031; their non-cancelable terms range from one to 26 years. The filing also listed $811.0 billion in purchase commitments and other contractual obligations, primarily for technical infrastructure and inventory, along with energy take-or-pay contracts. These are distinct disclosures, not three measures of funded debt to add together.
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Oracle: a financing plan is not proof of completed issuance
On February 1, 2026, Oracle announced that it expected approximately half of its 2026 financing to come from equity-linked and common equity issuance, including an at-the-market program of up to $20 billion. It said the other half would come from a single investment-grade senior unsecured bond transaction early in 2026 and that it did not expect additional bond issuance during calendar 2026 beyond that transaction. This describes the company’s plan as announced; the announcement alone does not establish the final size or completion of each part.
Applied Digital: borrowing tied to a named project
Applied Digital’s March 2026 offering disclosure said the net proceeds from its senior secured notes were intended to finance construction of 200 MW of critical IT load at Polaris Forge 2, its AI Factory campus in Harwood, North Dakota, leased to Oracle, as well as related project accounts and expenses. The notes bear 6.750% annual interest payable semi-annually and mature March 15, 2031, unless redeemed or repurchased under the indenture. The indenture restricts additional indebtedness, liens, certain asset sales and other actions.
In a later fiscal 2026 filing, Applied Digital described additional contracted projects: 300 MW at Delta Forge 1 and 300 MW at Polaris Forge 3, with initial operations anticipated during calendar 2027. Those are company-stated expectations, not confirmation that the facilities have entered operation.
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Cipher Digital: a lease can underpin project financing
Cipher Digital’s 2025 Form 10-K describes a 15-year lease agreed in October 2025 with Amazon Web Services for approximately 300 gross MW of turnkey capacity at its Black Pearl facility. Phased delivery was expected to begin in 2026. Cipher says long-duration leases can support project-level borrowing and joint ventures, and that hyperscale or investment-grade customers can improve a project’s credit profile and access to structured financing. That is the company’s description of its financing model, not a guarantee of a project’s performance or repayment.
Nebius: an AI-cloud company borrows at the company level
Nebius announced on July 17, 2026 that it had entered its first senior secured debt facility, for approximately $775 million. It described the transaction as significantly oversubscribed and its strategy as spanning owned data centers and asset-light partnerships. The announcement establishes an AI-cloud financing example; without more transaction detail, it should not be classified as a loan solely for data-center construction.
Independent reader supportYour contribution helps us test, update, and keep practical guides available for everyone.How to assess a data-center financing deal
Two deals with similar headline amounts can place risk in different places. Use the filing or transaction disclosure to answer these questions:
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- Who owes the money? Is the borrower a parent, operating subsidiary, project company or special-purpose entity?
- What is the instrument? Distinguish a corporate bond, construction loan, private-credit facility, secured project note, asset-backed security, lease, equity issuance or purchase commitment.
- What supports repayment? Look for companywide cash flow, a tenant lease, contracted capacity, asset value or a combination. A forecast is not equivalent to a signed lease.
- What stage is being funded? Land, construction, equipment and fit-out, operations, or refinancing of a completed site carry different execution and cash-flow profiles.
- What are the terms? Check interest rate, maturity, amortization, collateral, covenants, recourse and refinancing conditions. A secured loan can give lenders claims on specified assets; it does not by itself show whether the project will meet its obligations.
- How concentrated is the revenue? Identify the tenant or anchor customer when disclosed, and consider whether project repayment depends heavily on one counterparty.
- What is on the balance sheet now? Separate outstanding debt from leases that have not commenced, purchase commitments, guarantees and other obligations, using the company’s definitions and reporting date.
What borrowing does—and does not—say about risk
Data centers require large, long-lived commitments, and some project financing depends on tenant leases and timely delivery. Those features make several questions important when assessing an individual deal:
- Can construction finish on schedule and within budget?
- Will the required power and other infrastructure be available when the facility is ready?
- Is the tenant creditworthy, and is the project overly dependent on one customer?
- Can the borrower afford interest costs and meet covenant requirements?
- Will the facility generate contracted cash flow in time to repay or refinance debt at maturity?
The OECD’s market overview and the cited company disclosures document multiple financing channels, commitments and projects. They do not establish that the overall AI infrastructure buildout is in crisis. A rising borrowing figure is a reason to inspect the borrower, the cash flows and the terms—not a standalone diagnosis of distress.
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