Meta's AI spending is increasingly becoming a CREDIT risk: Meta's, $META, 5-year credit default swap (CDS) spread, which measures the cost of insuring against default, has surged to 127.9 basis points, up from just 49.9 bps a year ago and approaching its October 23rd high of 130.5 bps. Meanwhile, S&P Global Ratings lowered its outlook on the company from stable to negative, while affirming its AA- credit rating, citing rising leverage and growing pressure from AI-related spending. S&P expects Meta's CapEx to reach $140 billion in 2026 and accelerate to more than $225 billion in 2027, while leverage could exceed 1.0x next year, up from approximately 0.1x in 2025. The firm has also disclosed more than $800 billion in future spending commitments, with nearly 50% tied to leases that have not yet begun, largely for data centers and energy infrastructure. Crucially, S&P considers Meta's ability to monetize its AI investments more limited than that of its peers, warning that it remains unclear when AI spending will generate enough revenue to offset rising costs. Credit risk is surging among Big Tech amid record debt issuance and AI spending.