Analysis: Nine Tech Giants Including Google, Microsoft, and Meta Have Hidden $3 Trillion in AI-Related Debt Through Off-Balance-Sheet Arrangements, Triple Their Reported Debt
An analysis by The Wall Street Journal indicates that nine technology companies, including Google, Microsoft, Meta, Amazon, Oracle, NVIDIA, Broadcom, AMD, and SpaceX, have accumulated up to $3 trillion in off-balance-sheet AI-related obligations through purchase commitments and leases that have not yet begun. This figure is three times the total leases and long-term borrowings currently reported on these companies' balance sheets, and nearly double the $1.65 trillion estimated in July. Among them, Google's purchase commitments and contractual obligations reached $811 billion as of June 30, an increase of 152% in three months. The analysis emphasizes that this is not accounting fraud but rather a practice allowed by existing accounting rules, though it could lead investors to underestimate the true leverage and the potential impact of future depreciation on profit margins.
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