Weekly AI-Linked CDS Trading Averages More Than $9 Billion

Credit default swaps tied to seven AI-linked companies averaged more than $9 billion in weekly trading in September, drawing attention to credit exposure as companies finance the data center buildout.

The contracts covered Oracle, SpaceX, Alphabet, Amazon, Meta, Broadcom and Nvidia. Their average weekly trading value was less than $2 billion in July. The rise measures the value of contracts traded, not how much new protection buyers added.

A credit default swap, or CDS, provides protection against a specified credit event involving a borrower. Its spread is the quoted cost of that protection. Higher trading activity alone does not establish that a default is imminent.

CoreWeave was outside the seven-company trading tally. In a separate observation on Oct. 15, its five-year CDS spread exceeded 1,100 basis points, while Oracle’s was near 300 basis points. Protection costs for Amazon, Alphabet and Meta also reached records, though their increases were slower than those for CoreWeave and Oracle.

The moves add a credit-market measure to investors’ scrutiny of AI spending. A review of the period from June 1 through Sept. 3 found that CDS spreads rose for hyperscalers and semiconductor makers while spreads for the rest of a comparable S&P 500 group stayed stable. The comparison shows that the change was concentrated among companies tied to the buildout.

Data center construction helped drive more than $100 billion in investment-grade borrowing by hyperscalers in 2025. Large technology issuers entered the spending cycle with strong balance sheets, but continued capital spending can reduce free cash flow and increase borrowing needs.

“The CapEx requirements for the AI infrastructure are enormous,” Vishy Tirupattur, Morgan Stanley chief fixed income strategist, said in September. His comment addressed the scale of financing, before the Oct. 15 spread observations.

The exposure extends to suppliers that rely on hyperscaler spending. If major customers slow that spending, suppliers could have more difficulty servicing their own debt. Investors have also seen an earlier selloff in CoreWeave bonds as they weigh the financing behind AI infrastructure.