"Safe Haven" in Turbulent Markets: Amazon's $53.4 Billion Bond Issuance Faces Overwhelming Demand

This week, the bank responsible for selling Amazon’s corporate bonds sent a clear message to investors: in an increasingly unpredictable world, this company is a relatively safe investment.

On Tuesday, Amazon issued $37 billion in bonds across 11 maturities in the U.S., with subscription orders from asset management firms reaching as high as $126 billion, nearing a record.

On Wednesday, the company also issued bonds for the first time in the euro market, totaling €14.5 billion (about $16.8 billion), setting a record for the largest corporate bond issuance in the euro market history.

John Servidea, co-head of investment-grade debt capital markets at J.P. Morgan, said Wall Street banks have been advising companies that this is a “market environment where a window may open and close quickly.”

Servidea pointed out that due to significant volatility in stocks and bonds in recent weeks, Amazon’s relatively high credit rating became a key selling point for these bonds. Additionally, Amazon remains profitable, with an estimated net profit of around $78 billion in 2025.

For over a week, Amazon has been considering issuing bonds, as it is heavily investing in artificial intelligence. Last month, the company announced plans to invest about $200 billion in data centers, chips, and other equipment by 2026, exceeding analyst expectations.

However, after the U.S. and Israel launched military strikes against Iran on February 28, Amazon’s financing plans became complicated, and the global corporate bond market nearly stalled early last week. A few days later, the market resumed operations, with issuance totaling about $51 billion.

This sales volume was enough to convince Amazon and its banking team that market demand remains strong. An Amazon spokesperson said, “We regularly evaluate our operational plans and make financing decisions accordingly—such as signing credit agreements or issuing bonds.”

Investors said they were attracted by Amazon’s high credit quality. Robert Tipp, chief investment strategist at PGIM Fixed Income, stated, “Within our foreseeable investment horizon, this is a high-quality credit asset, and investors are also seeking yields.”

In Europe, Amazon initially planned to issue at least €10 billion in bonds, but strong demand ultimately led to an expanded issuance, setting a record. At the peak of orders, investors placed over €35 billion across eight maturities.

Marco Baldini, global head of investment-grade bond underwriting at Barclays, said, “This issuance became the largest transaction in euro corporate bonds in history, demonstrating the depth and liquidity of the euro market and its gradual catch-up to the U.S. dollar market.”

In a market environment characterized by fluctuating prices and risk premiums, companies with stable profits tend to be more attractive.

Servidea from J.P. Morgan summarized, “In volatile markets, credit quality, transaction structure, and liquidity are especially important. Large, well-prepared issuances like Amazon’s are precisely the kind of deals that can stimulate investor demand.”

(Source: Cailian Press)