AI Funding Revives Convertible Bonds as Companies Hunt Cheaper Debt

US convertible bond issuance hit $57 billion in 2026—a record. Companies funding AI infrastructure are using these hybrids because they're cheaper than straight debt: bondholders accept lower interest payments in exchange for the chance to convert into company stock. Higher interest rates post-2022 made the math work. The market hasn't seen this volume since the pandemic.