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CoreWeave Stock and Bonds Plunge Amid AI Debt Worries
· Confirmed
In Short: The Business Times in Singapore reported that the cost of insuring against CoreWeave’s debt has surged past 1,000 basis points to record highs this week, highlighting the extent of investor worries.
CoreWeave's stock price has dropped more than 26% this week, falling below two-thirds of its value from its peak in June 2025, according to BullionVault and BullionVault.
Shares of the AI cloud provider have been the biggest decliner in the Nasdaq 100, with a 15% drop on Wednesday following a chart posted by venture capitalist Chamath Palihapitiya on X.
The yield on CoreWeave’s 2032 bonds hit 15%, indicating growing investor concerns about the company’s debt load.
CoreWeave CEO Mike Intrator maintains that the market is acting “irrationally” and remains confident in the company’s business model.
Despite the downturn, Wall Street analysts have defended CoreWeave's funding strategy, suggesting that the company's business model is not as problematic as some investors believe.
The Business Times in Singapore reported that the cost of insuring against CoreWeave’s debt has surged past 1,000 basis points to record highs this week, highlighting the extent of investor worries.
CoreWeave’s stock has lost about a fifth of its value in October, with shares falling more than 6% in early trading after tumbling over 15% this week.
Investor concerns have been exacerbated by a spike in borrowing costs, bad inflation data, and a report by market research firm Gartner on AI infrastructure spending.
Nvidia, which owns 10% of CoreWeave and counts it among its largest customers, has invested roughly $300 million in the company across two rounds before its March 2025 IPO.
Despite the volatility, CoreWeave’s stock surged more than 12% the previous day, closing at $89.93 per share.
Critics have raised valid points about CoreWeave’s arrangements with Nvidia, but analysts argue that the company's business model is not as fragile as some investors fear.
The market's reaction to CoreWeave reflects broader concerns about the sustainability of AI demand and the potential risks associated with high levels of debt in the sector.
What this adds
The market's reaction to CoreWeave reflects broader concerns about the sustainability of AI demand and the potential risks associated with high levels of debt in the sector.
What's confirmed
- But silver prices failed to recover, hitting a 3-month low as global tech stocks plunged, sinking Asian equity markets amid the worsening crash in AI neocloud leader CoreWeave.
- Giant AI chipmaker Nvdia (Nasdaq: NVDA) owns 10% of the stock, and counts CoreWeave − which buys specialised GPU chips to build data capacity it then rents out to hyperscalers such as Facebook owner Meta (Nasdaq: META) − among its largest customers.
- Now losing more than 26% this week so far, shares in CoreWeave (Nasdaq: CRWV) have dropped more than 2/3rds of their value from their stock market peak of June 2025.
- CoreWeave (CRWV) stock reversed up on Thursday as Wall Street analysts defended the company's funding strategy to build out artificial intelligence data centers.
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- On the stock market today, CoreWeave stock initially fell 8% then reversed up.… 3:57 AM ET CoreWeave stock fell again Friday despite Cathie Wood's ARK Investment Management buying shares in the under-pressure, AI stock.
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- A spike in borrowing costs, bad inflation data and a report by market research firm Gartner on AI infrastructure spending had pressured CoreWeave stock.
What's still developing
- “ CoreWeave CEO Says Market Acting ‘Irrationally,’ Stands by Model.” Get personalized, AI-powered answers built on 27+ years of trusted expertise.
- “ CoreWeave targets ‘unlimited’ insurance money to fund AI build-out.” Bloomberg.
- Elon Musk —the CEO of SpaceX ( SPCX ), the platform’s owner—responded “Yikes.” The jump in bond yields is a concern, because it suggests investors require a steeper return to lend CoreWeave money, and could point to growing worries about the company’s debt.
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- “A hot inflation print triggered a sharp sell-off in CoreWeave because its business model is a highly indebted play on future data centre demand,” BCA Research analysts said.
- “The markets appear to be extrapolating a higher secondary-market bond yield as evidence the business model has stopped working, which we don’t think is the case,” they wrote in a note.
- “You cannot take CoreWeave as the poster child for AI,” said Tommaso Leodari, chief investment officer at Dubai-based hedge fund Index & Cie.
- He called claims of circular financing with Nvidia “ridiculous” and noted Nvidia’s stake is too small to support CoreWeave’s operations.
- Beyond that, a $6.3 billion deal commits Nvidia to purchase any unsold cloud computing capacity from CoreWeave through April 2032.
- After two decades of patrolling the dark corners of suburbia as a police officer, Rich Duprey hung up his badge and gun to begin writing full time about stocks and investing.
- Crude oil prices slipped but held above $100 per barrel again as the Saudi-Houthi conflict continued, Iran struck more vessels in the Strait of Hormuz, and fossil-fuel giant Russia accused Ukraine of hitting an oil refinery south of Moscow after embattled President Zelenskyy said "I'm done" with US President Trump's proclamation of an energy-infrastructure ceasefire ahead of America's mid-term elections.
- With the 'AI bubble' panic spreading as NVDA's own stock trades nearly 10% below last Monday's fresh all-time high, the price of gold today rebounded to $4150 per troy ounce at London's 3pm benchmarking auction after fixing on Wednesday at the lowest in 10 weeks at $4089.