Famed short-seller Michael Burry warns that Google’s potential 100-year bond offering is reminiscent of Motorola’s move nearly three decades ago.
Earlier this week, reports surfaced that Google’s $15 billion bond offering drew massive investor interest as they poured in over $100 billion in orders.
The tech giant is also looking to issue bonds in Swiss francs and British pounds, along with a rare 100-year note.
News of the possible 100-year bond offering caught the attention of Burry, who believes that the moment deserves closer scrutiny. He points to the last major US company to issue a century bond under similar circumstances.
“Alphabet looking to issue a 100-year bond. The last time this happened was with Motorola in 1997, which was the last year Motorola was considered a big deal. At the start of 1997, Motorola was a top 25 market cap and top 25 revenue corporation in America. Never again. The Motorola corporate brand in 1997 was ranked #1 in the US, ahead of Microsoft.”
Motorola is a consumer electronics manufacturer known for creating the first handheld cellular phone in 1983.
Burry says that what followed was a rapid erosion of dominance.
“In 1998, Nokia overtook Motorola in cell phones, and after the iPhone, it fell out of the consumer eye. Today Motorola is the 232nd largest market cap with only $11 billion in sales.”
Last month, Burry warned that AI could break Google’s golden goose in search. According to Burry, search is basically all of Google’s cash flow, and AI is changing the game, pushing costs from “fractions of a cent” to tens of dollars per inquiry.
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