Hyderabad: Microsoft has priced a $25 billion bond sale to finance general corporate needs, including rising capital expenditure on artificial intelligence infrastructure.
The debt offering comes just days after the company announced voluntary exit packages for eligible employees. The offer covers approximately 60,000 employees across the United States, India, Canada and the United Kingdom.
Microsoft’s latest bond sale marks its first US investment-grade debt offering since 2017. The company plans to use the funds as its spending on AI data centres continues to increase.
The bonds attracted orders worth approximately $115 billion, representing 4.6 times the total offering. People familiar with the transaction provided the figures.
The notes were priced across 10 tranches, with maturities ranging from 2028 to 2066. The transaction is scheduled to close on November 4.
Microsoft Bond Sale Attracts Strong Investor Demand
Fixed-rate coupons range from 4.85% for $2 billion of notes due in 2028. They rise to 6.35% for $2 billion of notes maturing in 2066.
The offering also includes two floating-rate tranches worth $1 billion each.
Investors were attracted partly by Microsoft’s strong credit rating. Microsoft and Johnson & Johnson are the only publicly traded US companies holding AAA ratings from both Moody’s and S&P.
Microsoft last raised debt through this market in 2017, securing $17 billion.
The latest offering is also the first by a major hyperscaler since Alphabet issued $25 billion in debt in August. Meta instead raised $25 billion through an equity offering.
Microsoft also reported positive free cash flow during the quarter. Alphabet, Meta and Amazon reported negative figures, according to the supplied report.
Hyperscalers and data centre developers have raised more than $313 billion through global investment-grade bonds this year. That amount is nearly three times the full-year total for 2025.
Voluntary Exit Offer Covers 60,000 Employees
Microsoft announced its voluntary exit programme on October 26. It covers eligible employees at level 70 and below in participating teams.
The programme potentially covers more than one-quarter of Microsoft’s 223,000 full-time employees. Chief People Officer Amy Coleman said the offer allows employees to make the transition with support.
According to a source familiar with the plan, eligible teams include AI experiences, Copilot, finance and human resources. Xbox and Windows + Devices are also included.
Marketing, commercial business and security teams are excluded from the programme.
Microsoft expects 3,000 or fewer employees to accept the offer. That represents approximately 5% or less of eligible employees.
Chief Financial Officer Amy Hood addressed the programme in her quarterly earnings memo. She said employees could choose to leave the company on their own terms.
Hood also expressed confidence in Microsoft’s growth opportunities. She said the company expected very few employees to accept the offer.
Earlier this year, Microsoft offered voluntary retirement packages to approximately 9,000 US employees. Roughly one-third of eligible employees accepted the offer.
The programme helped the company reduce the need for additional layoffs later. In July, Microsoft announced 4,800 job cuts during its Xbox restructuring.
Microsoft Forecasts $175 Billion in Capital Spending
Microsoft’s latest quarterly results showed continued business growth. Revenue increased 19%, while operating income rose 21%.
Azure revenue climbed 48% during the quarter. Hood said demand for Azure services continued to exceed available supply.
She also thanked engineering teams working to expand capacity faster.
Microsoft has forecast approximately $175 billion in capital expenditure for 2026. Much of the spending is linked to expanding AI and cloud infrastructure.
The company is expected to provide further details about its AI and cloud strategy at its Ignite conference. The event is scheduled from November 17 to 20.
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