AI Infrastructure Quarterly: Secondary Volatility Snags the Primary Machine; IG Issuance Down 50% QoQ

Credit Research: Anton Gorbounov, CFA, Rucha Amdekar Relevant Items: AI Infrastructure Database – Sept. Update AI Infrastructure Chartbook   Key Takeaways   The outstanding amount of below-investment-grade AI infrastructure debt tracked by Octus swelled to $184 billion as of Oct. 16, up from $125 billion at the end of June. Our database now also includes over $700 billion of investment-grade issuance across hyperscalers and related special purpose vehicles and joint ventures.   In the third quarter, issuance volumes declined from their record-breaking second-quarter levels across the board, with investment-grade AI infrastructure issuance alone falling nearly 50% quarter over quarter.   Secondary trading in the sector, already volatile throughout the third quarter, reached a fever pitch in October as CoreWeave bonds traded down to distressed territory while a number of secured data center bonds widened well past 10% yields.   Our updated database, which now includes nearly 400 debt tranches, is available for download on the AI Infrastructure analysis page HERE. We also publish a chartbook, which includes the charts and tables in this report, as well as detailed bond performance data. It is available for download on the analysis page and HERE.   We will be hosting a webinar on[...]