What happened
Meta's five-year credit default swaps rose as much as 8.9 basis points to 119.3 basis points a year, a record, over concerns about about $825 billion in future spending on leases and contracts, mostly for computing power and AI infrastructure, Bloomberg reported, citing ICE Data Services.
Why it matters
The record cost of insuring Meta's debt signals that investors are pricing in more risk from the company's long-term spending commitments, even though its shares were down 5.6% around midday.
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Meta's record credit default swap price comes as the company outlined a substantial increase in its 2026 capital expenditure expectations, to $135 billion to $145 billion from a prior range of $130 billion to $145 billion. The swap price move reflects investor concern over about $825 billion in future spending on leases and contracts, mostly for computing power and AI infrastructure.
This is happening against a backdrop of broad investor unease over artificial intelligence spending, as all three major US stock indexes were down in late-morning trading Thursday. Meta's shares were down 5.6% around midday, and the company also reported Q3 earnings that missed the FactSet consensus on a per-share basis even as revenue beat expectations.
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