Downtown Josh Brown

Debt was almost non-existent amongst the tech giants.

This is the thing that we originally loved about these companies.

They were not capital intensive with the exception of Amazon.

And there was no need for debt because they were producing enormous cash flows.

And to your point earlier in the show, that has completely gone into reverse.

770 billion in CapEx in 2026, 100% of cash flow from operations for those companies.

And not only are they selling more stock in some cases, now they're selling a lot of bonds.

And that is not a problem yet because they all have very high credit ratings.

The last thing on this, Tony Pasquarello from Goldman Sachs.

Quote, for several years, U.S.

mega cap tech companies have generated, returned and reinvested capital to an extent that no other cohort could touch.

I believe that will be the case for a while longer.

But what has clearly changed is the capital requirement of AI so immense that free cash flow alone can't do all the heavy lifting.

He says, put this chart up.

In the aggregate, it's not yet time to worry about the inability of these companies to access capital.

Our work suggests the core hyperscalers can add around 700 billion of more financing before their net debt load is greater than one times 2026 EBITDA.

So of course, that's a very Goldman-friendly message from Tony at Goldman.

They do want to be involved in selling more debt for these companies.

Would you agree?

Yeah.