NEW YORK — Data center operator Equinix plans to raise at least $3 billion through a sale of U.S. investment-grade bonds, targeting the market as credit spreads on technology-related corporate debt have widened over the past month.
Investors now demand higher compensation for duration risk in a volatile rate environment. The two-year Treasury yield has held above 4.8 percent for weeks, pushing up borrowing costs across sectors. Federal Reserve Chair Kevin Warsh has maintained a hawkish stance on inflation, reinforcing higher-for-longer rate expectations.
Equinix (EQIX) operates more than 260 data centers globally and reported $8.2 billion in revenue for 2025. A $3 billion offering represents its largest single debt raise in recent memory. The company's last significant U.S. dollar bond offering, in March 2026, raised $1.5 billion across multiple tranches, including a 10-year note priced at a 4.95 percent yield.
The AI sector's capital demands have fueled a surge in debt issuance from infrastructure companies, but investor appetite has cooled on concerns about future cash flows and the pace of build-out. Higher yields on the new debt would pressure Equinix's net interest expense and squeeze profitability margins. Digital Realty faces similar financing dynamics.
Despite spread widening on AI-specific debt, demand for core data center capacity remains strong, supported by growth in cloud computing and AI workloads. Equinix's essential role in global digital infrastructure gives its credit profile a defensive quality that investment-grade buyers—pension funds and insurers chief among them—will weigh against the broader market softness.
Pricing is expected in the coming days. The market's reception will serve as a bellwether for AI infrastructure firms planning to tap debt markets in the second half of 2026.
