Moody's has issued a report warning of a $66.2 billion off-balance-sheet risk stemming from the tech sector's AI infrastructure race. The five largest U.S. hyperscale cloud providers—Amazon, Meta, Alphabet, Microsoft, and Oracle—have committed to future data center leases totaling $662 billion, which are not yet recorded as liabilities. As these leases activate, over $500 billion will be added to their balance sheets, potentially affecting financial metrics.
The report highlights that by the end of 2025, these tech giants' undiscounted future lease commitments will reach $969 billion, with $662 billion in leases yet to commence. Under U.S. GAAP, these obligations remain off-balance-sheet, posing a risk of increased adjusted debt levels and impacting financial flexibility and credit ratings as they transition onto the balance sheet.
Moody's Highlights $66.2 Billion Off-Balance-Sheet Risk in AI Infrastructure
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