Guarantees, not borrowing
Large technology companies have issued about $300bn of guarantees backing AI data centres and chips in less than a year, the Financial Times reported on Sunday, and almost none of it appears on the debt line of their balance sheets.
The instrument at the centre of the reporting is the residual value guarantee. A separate financing vehicle raises the money and owns the asset; the technology company promises that if the data centre or its chips are eventually sold for less than an agreed figure, it will cover part of the shortfall. Because the borrowing belongs to the vehicle rather than to the guarantor, the exposure is disclosed in footnotes and commitment tables rather than counted in leverage ratios.
The FT put Nvidia’s guarantee tied to an OpenAI data centre in Ohio at $105bn, Broadcom’s commitment covering racks destined for Anthropic at about $29bn, and Meta’s residual value guarantee on its Hyperion project in Louisiana at about $28bn.
Alphabet’s number more than doubled in six months
Alphabet’s disclosed data centre guarantees rose from $16.9bn to $43.8bn over six months, according to the FT’s reading of its filings, while the company carries a provision of $815m against that maximum exposure — the amount it judges it is probably going to lose, rather than the amount it has promised. Less than 2 per cent of the guaranteed sum reaches the balance sheet itself.
Meta’s Hyperion financing shows the other half of the pattern. A special purpose vehicle named Beignet Investor raised roughly $30bn for the Louisiana campus, about $27bn of it debt from lenders including Pimco, BlackRock and Apollo, with roughly $3bn of equity from Blue Owl Capital. The vehicle owns the site and Meta leases it back. The FT reports that Meta, xAI, Oracle and CoreWeave have between them moved more than $120bn of data centre financing to outside investors through structures of this kind.
Morgan Stanley puts the wider figure across seven firms at $3.1tn of off-balance-sheet commitments, on a broader definition that takes in leases and purchase obligations as well as guarantees.
Legal, disclosed, and hard to add up
None of this is hidden in the sense of being undisclosed. The structures are permitted under current accounting rules and the numbers sit in company filings. The difficulty is that a balance sheet obligation flows automatically into every leverage ratio, credit model and stock screen built on top of it, while a footnote has to be found and added by hand.
That distinction is doing real work. Keeping the debt off the books keeps reported leverage down, which supports the investment-grade credit ratings the largest buyers of AI infrastructure depend on to borrow cheaply in the first place.
One assumption carries the risk
A residual value guarantee only pays out when a building or a tranche of accelerators is worth less at sale than the figure written into the contract. If AI demand grows into the capacity now being built, the guarantees expire unused and cost nothing. If it does not — or if a generation of GPUs depreciates faster than the schedules assume — the shortfall lands back on the guarantor as a loss that investors were not counting as debt.
The next test is the third-quarter filings. Alphabet’s guarantee line grew by $26.9bn in six months; whether it keeps growing at that rate, and whether the provisions set against it move at all, is the clearest public read on how the companies themselves rate the odds.
