Funding APAC’s AI Revolution #4: how will Chinese internet majors fund capex?

Building on Funding APAC’s AI Revolution #2, this report examines Chinese internet majors’ funding gaps and potential offshore bond issuance. We estimate internet majors’ total capex at US$1.2tn over ’26-30, comprising US$935bn of onshore AI capex, US$175bn of onshore non-AI capex and US$105bn of offshore AI capex, assuming 2.5-3.5GW of overseas leased capacity at US$35bn/GW. We focus on BAT, assuming they account for 50% of total capex, implying US$555bn of onshore and US$53bn of offshore capex. Onshore needs should be largely self-funded: assuming a 15% 5-year CAGR, we estimate US$637bn of EBITDA over ’26-30, implying a US$82bn cumulative surplus. Offshore needs require external financing: we expect limited cash generation against US$53bn of capex and US$75bn of shareholder returns, implying a US$128bn cumulative shortfall. We believe BAT will front-load AI investment, with 50% of AI capex spent in ’27-28, resulting in funding shortfalls of US$35bn onshore and US$56bn offshore over t