Microsoft has agreed to issue $25bn of senior unsecured notes in ten tranches, a mix of floating rate and fixed rate debt maturing between 2028 and 2066. The fixed rate notes carry coupons from 4.850% to 6.350%. Terms were set on October 29, and the supplemental indenture, the contract that governs the notes, is dated today.

The long end of the structure is the telling part. Maturities out to 2066 suggest Microsoft is financing well beyond the current spending cycle rather than leaning on short-dated borrowing. Its chief financial officer has said calendar-year capital spending should be about $170bn, with spending speeding up in the second half of the fiscal year as third-party capacity deliveries shift into that period.

The borrowing comes even though Microsoft has said it expects to stay cash flow positive through fiscal 2027, and even though it returned $10.2bn to shareholders through dividends and share repurchases in the latest quarter.

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