Morgan Stanley has overtaken Goldman Sachs as the leading underwriter of artificial intelligence-related debt, steering billions into the data center infrastructure that underpins AI’s explosive growth. This transition marks a subtle yet critical reshaping of Wall Street’s role in financing the AI buildout, reflecting the growing reliance on debt rather than equity or internal cash to fund massive capital expenditures.
The Increasing Scale of AI Infrastructure Financing
CEO Ted Pick’s recent remarks reveal a striking upward revision in data center spending: from an initial $575 billion forecast in late 2025 to roughly $850 billion for 2026, a near 48% increase. This surge highlights the accelerating demand for hyperscaler and cloud capacity needed to support advanced AI workloads. Morgan Stanley’s involvement in a $13 billion debt package for a Meta data center in El Paso, Texas, illustrates the scale and complexity of these financings. Such deals shows how banks are capitalizing on the capital-intensive nature of AI infrastructure, crafting structured credit and bond issuances that enable rapid facility expansion without resorting to dilutive equity.
Global AI-related debt issuance is anticipated to hit $570 billion this year, a figure that signals the profound shift in corporate financing strategies for cutting-edge technology. Industry analyst Mike Mayo points to Morgan Stanley, Goldman Sachs, and JPMorgan as the primary underwriters benefiting from this trend, while Bank of America’s involvement raising nearly $500 billion for AI ventures since 2025 demonstrates the broad institutional appetite fueling this phenomenon.
The financing ripple also extends into crypto-adjacent sectors. Morgan Stanley’s backing of Core Scientific, a miner pivoting toward AI-focused infrastructure, with up to $1 billion, later supplemented by JPMorgan’s additional $500 million, culminated in a substantial $9 billion merger with CoreWeave. Together, they plan to invest $5.5 billion developing six new data centers by mid-2027, blending AI’s growth momentum with blockchain technology infrastructure needs.
However, the rapid expansion of AI debt is not without risks. Bond markets have begun signaling concern through increased pushback on coverage ratios for hyperscaler bonds, indicating lenders might demand higher yields to compensate for emerging credit risks. Goldman Sachs CEO David Sol’s comments, though not detailed here, come amid these pressures, hinting at potential recalibrations in risk appetites as the AI financing wave gathers more steam.
This dynamic financing environment suggests that Wall Street’s AI debt market will remain a focal point for investors and companies seeking to capitalize on AI’s infrastructure demands while navigating increasing credit market caution.
