Alphabet Inc. is selling euro-denominated bonds for the second time this year, testing investor appetite after recent turmoil in technology debt widened borrowing spreads across the sector.
The Google parent has opened order books on a seven-part euro bond offering with maturities ranging from two to 19 years, according to a person familiar with the matter who requested anonymity. Initial price guidance on the two-year fixed-rate portion is roughly 60 basis points over mid-swaps, while the 19-year notes are being marketed at approximately 205 to 210 basis points over mid-swaps.
The transaction follows disappointing earnings from Alphabet last week, which heightened worries about the magnitude of artificial-intelligence spending and contributed to wider spreads across technology debt. On Friday, contracts insuring against a default on Alphabet's debt surged 6.4 basis points, the largest single-day increase on record in absolute terms, reaching an all-time high of nearly 91 basis points.
A day earlier, the company's stock had endured its biggest one-day decline on record following weak search and advertising revenue, amplifying fears that AI poses a threat to its core business.
Technology firms are anticipated to keep borrowing heavily to finance AI investments, even as recent debt sales have encountered softer demand and broader pricing. Alphabet has kept its capital-spending projection at up to $205 billion for this year.
Alphabet raised €9 billion ($10 billion) across six tranches in May. Barclays Plc, BNP Paribas SA and Deutsche Bank AG are managing Monday's offering, which is expected to be priced later in the day.
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