Microsoft launches its first investment-grade U.S. dollar bond issuance since 2017, aiming to raise at least $25 billion.

On October 29 that Microsoft (MSFT.O) is conducting its first high-grade bond issuance in over nine years. As an investment boom in AI drives surging financing needs, Microsoft is joining its peers in heavy borrowing. According to informed sources, Microsoft plans to issue benchmark bonds in 10 tranches with maturities ranging from two to 40 years, with the preliminary pricing guidance for the longest-maturity tranche (maturing in 2066) set at up to 1.35 percentage points above U.S. Treasury yields.

Wells Fargo, JPMorgan Chase, and UBS Group are managing the bond issuance. Informed sources stated that the proceeds will be used for general corporate purposes, including capital expenditures. This issuance ends a prolonged hiatus from the bond market, with Microsoft's last high-grade bond issuance occurring in 2017 when it raised $17 billion across seven tranches. Additionally, recent reports indicate Microsoft aims to raise at least $25 billion through U.S. bond issuances.

Microsoft's premarket gains narrowed to 1%, following a previous surge of over 4%.