Alphabet Backstops Data Center Leases for AI Chips

Alphabet is using Wall Street-style financing to guarantee leases on data centers that will house its AI chips. The company has backstopped roughly ten projects and agreed to backstop up to $44 billion in data center leases, a sevenfold increase from prior levels. The arrangement speeds AI chip adoption and expands chip sales. Until recently big tech balance sheets were simple and cash-rich, but massive AI spending has prompted these complex financing moves.