For the first time, I’m starting to wonder if hyper-scaler management might’ve lost the plot in earnest.

By “in earnest” I mean I’m beginning to suspect a case of mild delirium might’ve taken hold in the C-suite among the big AI spenders. (Some of you will immediately quip that “mild” is an understatement of trillion-dollar proportions.)

It’s not that I expected capex plans to be cut this quarter. I obviously didn’t. No one did. Nor did I anticipate management would evidence a rekindled commitment to capital discipline despite clear signs of market angst around the trajectory of AI-related borrowing and spending.

There’s been no change to analyst estimates for 2027 hyper-scaler capex, which is seen at $1.2 trillion, and everyone knows the free cash flow situation’s going to get worse before it gets better.

The figure above shows you historical and projected FCF for the big-spending tech heavyweights.

So, again, it’s not that I’m surprised by anything we learned over two weeks of hyper-scaler reports. Indeed, we didn’t learn anything. That’s kinda the point. They’re still spending, planning to spend more and with FCF turning negative, funding that spending will entail debt or equity raises. (Both.)

But I wonder if management learned anything from the decidedly adverse price action seen in shares of Meta, Amazon and particularly Alphabet following earnings. Microsoft held up better, but note from the chart that FCF’s still positive there, and not expected to turn negative.

With that in mind, we’ve just seen two more hyper-scaler debt deals, and no sooner had they launched than Bloomberg was out previewing another one.

As the figure shows, Alphabet launched a seven-tranche EUR deal today, with maturities from two to 19 years (it’s the second time Alphabet tapped the EUR market this year) and Oracle a $10 billion, six-tranche deal with maturities from three to 20 years alongside a $10 billion stock offering.

That’s on top of Microsoft’s 10-tranche $25 billion deal which priced last week, and ahead of what Bloomberg says could be a $20 billion, cross-border placement from Meta. And don’t forget about the pending $40 billion SpaceX deal.

This is too much supply, and that’s showing up in the pricing. Alphabet’s paying more this time in the EUR market than it did in May and as Bloomberg noted in a separate piece, the company’s existing euro bonds “have widened as much as 60bps since they started trading.” That as investors in Alphabet’s massive equity offering are deeply underwater following last week’s rout in the stock.

Meanwhile, Anthropic amended its S-1 to include Q3 results. The updated filing also tallies the company’s commitments and lease agreements, which come to “approximately” $895.4 billion. I don’t know why “approximately” sounds funny there, but it does.

Maybe Claude can tell you why that’s not a scary sum, but… well, the only way $895.4 billion (“approximately” or exactly) isn’t a large number is if you’re Elon Musk on a day when SpaceX is up big.