SoftBank is preparing one of the largest high-yield bond offerings in recent years, seeking more than $11 billion to support its aggressive expansion of artificial intelligence investments. The transaction underscores how rapidly the funding requirements of the AI boom are moving from equity markets into credit markets, while also putting greater attention on SoftBank’s leverage and exposure to OpenAI.

SoftBank Turns to High-Yield Debt for OpenAI Funding

The planned offering is expected to include approximately $10 billion of dollar-denominated bonds and €1 billion of euro-denominated notes. The dollar securities are being structured across 3.5-year, 5.5-year and 7.5-year maturities, while the euro portion is expected to include four-year and six-year maturities.

Most of the proceeds are intended to finance SoftBank’s $10 billion payment for the third tranche of its follow-on investment in OpenAI, which is expected to close by October 1. Some of the proceeds will also be available for general corporate purposes. The bond issuance would replace an earlier $10 billion bridge loan SoftBank arranged to finance the same investment.

SoftBank carries a BB+ credit rating from S&P Global Ratings, placing the company in speculative-grade territory and making the planned debt sale part of the high-yield market rather than investment-grade credit.

AI Investment Is Becoming a Major Credit-Market Story

The size of the transaction highlights the growing role of debt in financing AI infrastructure and investments in leading AI companies. SoftBank has committed nearly $65 billion to OpenAI, making its financial profile increasingly connected to the valuation and future development of the AI company.

The company has already raised substantial financing this year. It recently secured an $11.87 billion two-year bank loan backed by commitments from roughly 20 lenders and also completed a ¥1 trillion bond sale in Japan. The increasing use of debt gives SoftBank more resources to pursue AI opportunities, but it also increases the importance of cash flows, asset values and refinancing conditions.

Market Conditions Will Test Investor Appetite

The bond sale comes at a challenging time for borrowers. U.S. Treasury yields have risen sharply, with the 10-year yield recently moving above 5%, while inflation and geopolitical risks have kept global borrowing costs elevated. Higher benchmark yields generally require speculative-grade borrowers to offer more attractive spreads to bring new debt to market.

For SoftBank, investor demand will therefore provide an important market signal. Strong demand could demonstrate that investors remain willing to finance large AI-related commitments despite higher leverage. Weak demand or expensive pricing would indicate that the credit market is becoming more cautious about the scale and duration of AI spending.

Investors will watch the final size and pricing of the bonds, the response from institutional buyers and SoftBank’s progress toward completing its OpenAI investment. The broader significance extends beyond one issuer: the transaction could help establish how much credit markets are willing to provide for the next phase of AI investment and how financing costs may influence the pace of expansion across the sector.