Waymo is in the final stages of talks to raise more than $3 billion in debt, marking the first time Alphabet’s self-driving unit has turned to debt financing. Lenders in the deal include Pacific Investment Management (Pimco), Blackstone, and Sixth Street Partners, according to Bloomberg.
Goldman Sachs is working with Waymo on the transaction, which could be finalized within days. Terms are still being discussed and could change.
The loan is expected to be unrated and could price at more than 500 basis points, or five percentage points, above its benchmark rate. That makes it a relatively expensive form of financing.
Alphabet stock (GOOGL) was up 0.63% at the time of reporting. Wall Street holds a Strong Buy consensus on GOOGL, with an average price target of $422.96, implying around 25% upside.
This debt raise comes just months after Waymo closed a $16 billion equity round in February 2026 that valued the company at $126 billion, nearly tripling its valuation in under two years.
So why the shift to debt now? The short answer is scale. Waymo is expanding its driverless fleet rapidly while AI-related operating costs remain high. Equity alone isn’t cutting it anymore.
The company currently runs more than 500,000 paid rides per week across 14 U.S. cities. Its stated goal is to hit one million paid rides per week across 20 cities globally before the year is out. That’s a lot of robotaxis to deploy.
Beyond the U.S., Waymo is preparing to test its service in more than a dozen additional locations, with London and Tokyo among the planned markets. That kind of international push comes with serious capital requirements.
The robotaxi space is also getting more crowded. Waymo is competing directly with Amazon’s Zoox and Tesla’s self-driving vehicles, and the race to scale is intensifying.
On the technology side, Waymo said last month it had developed a custom chip for its robotaxis, a move aimed at cutting costs and improving performance. Building proprietary hardware is another capital-heavy investment that adds to the company’s funding needs.
Waymo and Goldman Sachs did not respond to a Reuters request for comment. Blackstone, Pimco, and Sixth Street Partners all declined to comment.
Waymo has historically relied on equity financing from Alphabet and external investors. The move into debt markets reflects how much the business has grown and how much more capital it needs to keep pace with its expansion plans.
Wall Street analysts have assigned GOOGL a Strong Buy consensus based on 24 Buy ratings and four Holds over the past three months. The average price target of $422.96 implies around 25.4% upside from current levels.
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