Five US Tech Giants' Hidden AI Liabilities Reach $1.65 Trillion
Claire Weston
Alphabet, Microsoft, Amazon, Meta and Oracle hold roughly $1.65 trillion in off-balance-sheet commitments — an eightfold increase in four years, now exceeding their combined on-book interest-bearing debt of about $1.35 trillion. This means → the real financial cost of the AI arms race is being legally hidden by accounting rules.
Where is the $1.65 trillion hiding?
The hidden debt comes from two sources: long-term purchase contracts for GPUs and servers not yet delivered, and lease agreements for data centers not yet operational.
Under current accounting standards, neither type appears on the balance sheet. They show up only in quarterly-filing footnotes. In plain terms = the money is committed, but the main financial statements don't show it.
Nikkei notes the practice is fully compliant, but ordinary investors may struggle to spot the real financial exposure buried in footnotes.
Which company carries the most?
Meta leads with roughly $420 billion in off-balance-sheet debt — nearly three times its on-book borrowings.
Oracle's hidden commitments grew more than 30-fold over four years to $273.3 billion by end of May, driven largely by the Stargate data-center project it is building with OpenAI.
This reflects two distinct expansion paths: Meta scales through self-built facilities plus joint-venture leases; Oracle bets on a single mega-project.
How does "shadow borrowing" work?
Meta formed a joint venture with Blue Owl Capital to build a data center in Louisiana. The total development cost has risen from an initial $27 billion to over $50 billion as of July 13, 2025.
Meta holds only 20% equity and uses the facility through a lease — but has committed to backstop investor losses if the data center is no longer needed. This means → the risk hasn't truly transferred; it has simply moved off the balance sheet.
The Bank for International Settlements (BIS) defined this mechanism in a March report as "shadow borrowing" — raising capital from institutional investors without adding on-book debt.
What is the tech companies' counter-argument?
All five companies argue that future revenue will cover the commitments. Alphabet, Microsoft and Amazon's disclosed cloud-service backlogs totaled roughly $1.45 trillion as of end-March.
AWS CEO Matt Garman said the company's investment is "not speculative."
Yet all five declined to comment on the growth of their hidden obligations. In plain terms = they have backlog data to back the revenue outlook, but won't discuss the risk side.
When does the real test arrive?
As data centers come online, these commitments will move from off-balance-sheet to on-balance-sheet, visibly changing the companies' financial profiles.
The core risk: if AI demand growth falls short of projections and utilization rates decline, data-center assets could lose value and trigger write-downs. This means → hidden debt won't stay hidden forever — it only delays the reckoning.
Moody's flagged in February that uncommenced lease commitments are ballooning; Morgan Stanley has published a detailed investor report on the issue. This signals that institutional-level scrutiny is intensifying.
Content is for reference only, not financial advice.