Big Tech AI spending has gone off the rails!
The off-balance sheet lease commitments and purchase commitments for Meta, Google, Microsoft, and six additional companies are almost $3 trillion dollars! These commitments far exceed their current CAPEX spending, which has already turned free cash flow negative. How are these commitments financed? Meta’s Hyperion data center is used as an example. Meta partners up with Blue Owl (yes that Private Credit darling) in a special venture, then Beignet Investor (holding company that owns Blue Owl Stake) raises the construction financing in the form of a bond sale. Meta, as the minority partner, is…
The skinny
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