Neocloud stocks such as Nebius Group (NBIS), IREN (IREN) and CoreWeave (CRWV) have sold off sharply in recent weeks amid debt concerns, after CoreWeave fell more than 15% on October 14 as bond yields jumped and Gartner warned of possible slowdowns in AI infrastructure spending. A second wave followed when Meta reported its first negative free cash flow quarter as a public company, fueling worries about the gap between heavy capex and cash flow. Elon Musk warned that debt markets have nearly shut off funding for companies without substantial revenue outside AI data centers, predicting consolidation among the 200+ neoclouds. Yet the stocks rallied on Monday, and the author compares this with Bill Ackman's 2020 warning before the market bottomed, suggesting the worst fears may already be priced in.
Summary written by Upside AI from the original article. Read the source for full details.
Read the original on Yahoo Finance ↗
Keywords
NVDACoreWeavedata centersbonds
Open a keyword to see other news on the same topic.
Related tickers and likely impact
NVDA
▲ Likely positiveNvidia
Relevance: low
| Market | US stocks |
|---|---|
| Sector | Information Technology |
| Industry | Semiconductors |
| Market cap | $5.1T |
| Close on 10/23/2026 | 210.96 |
| Change that session | -0.59% |
Impact is scored by AI from the headline and may be wrong. It is not investment advice.
Related news
- Musk Expects “a Lot of Stranded Compute” in Half-Built Data Centers. CoreWeave Carries the Risk
Elon Musk said on Saturday that he expects a lot of stranded compute in partially complete data centers, a risk the article says falls on neoclouds like CoreWeave and Nebius, which bought GPUs before the buildings were ready. CoreWeave paid $1.2 billion of net interest in 2025 against a $46 million operating loss, and its interest was $640 million in the second quarter of 2026 alone, with management guiding $860 million to $940 million for the third quarter. Total debt including leases reached $51.6 billion by June 30, 2026, and the stock has lost more than a third of its value in October as its bonds slid on debt fears. NVIDIA CEO Jensen Huang said a scarcity of capital is slowing neocloud buildouts. CoreWeave had 1.5 gigawatts of active power as of June 30 against 4.2 gigawatts contracted as of Aug. 11, and its Nov. 12 report will show whether that gap is closing.
- Short Sellers Just Made $6 Billion Betting Against AI Data Center Stocks
According to ORTEX, short sellers in U.S. neocloud and AI data center stocks held about $6 billion in unrealized paper profits through October 22, and those gains are marked again at every close. CoreWeave fell 10.06% to $55.60 on October 22, while Nebius fell 7.23% to $159.17 that day even after announcing a $3.5 billion Citi facility. Bernstein estimates CoreWeave needs about $85 billion for its existing contracts, and current facilities cover about $9 billion, leaving roughly $76 billion to raise externally. CoreWeave's unsecured bonds recently yielded around 15%, a level that signals real default risk for lenders, and nearly half of data center bonds sold in 2026 are junk-rated. Short interest in the five most-shorted names is about 20% to 26% of free float, so a sharp rebound could trigger a short squeeze.
- CoreWeave’s market confidence erodes as bond yields spike and stock sinks
CoreWeave faces growing investor doubts as bond yields rise and its stock falls, with a Barclays analyst describing sentiment as decidedly negative. The company is valued at roughly $34 billion, down from a peak market cap of about $90 billion, its stock is down 29% this month, and its unsecured debt yields about 15%. The spread on its five-year credit default swaps reached nearly 1,067 basis points, up 30% in October. Peers also fell sharply, with Nebius down 27% and IREN down 32% this month, while CoreWeave has about $20.7 billion of debt coming due through 2030.
- CRWV, NBIS, IREN Bounce Overnight After Brutal Week — But Industry Execs Reportedly See Only A Few Neocloud Survivors
Shares of neocloud operators CoreWeave (CRWV), Nebius (NBIS) and IREN edged up overnight after a week of selling driven by doubts over business models and higher financing costs. CoreWeave had fallen more than 20% in the early part of the week before gaining 6% on Thursday, supported by Nvidia CEO Jensen Huang. According to The Information, industry executives expect only seven to ten of hundreds of neoclouds to survive, with Nvidia supporting them through easier credit terms and $20 billion in leases. Bloomberg reported that Nscale faces opposition to its $30 billion IPO valuation, while CoreWeave's unsecured debt due in 2032 fell below 80 cents on the dollar, a level widely seen as a sign of financial strain.
- The AI Investment Bubble Is Starting to Crack … and You Might Be Exposed Without Knowing It – NaturalNews . com
The author argues that the AI infrastructure buildout is a speculative bubble, citing credit markets as the first hard signal: CoreWeave's bonds due 2032 breached the 'distressed' spread of 1,000 basis points, with yields topping 15% for the first time, versus six months to a year ago when these firms borrowed at 6% to 8%. Morgan Stanley analysts warned that Oracle's data center delays could strain its debt, and Bloomberg-cited strategist Chris Wood foresees massive capital destruction in AI. The author contends that open-source models from China, such as Moonshot AI's Kimi K3, now nearly match frontier models and can run on small hardware, reducing demand for costly data centers and subscriptions. He also points to Nvidia's RTX 5090 retail price doubling from $2,500 to $5,000 and predicts that major AI labs may go bankrupt while the technology survives. This is an opinion piece, and the content is cut off mid-sentence.
- CoreWeave shares sink 13% as Musk’s ‘Yikes’ highlights AI debt concerns
CoreWeave shares fell 13% and Nebius Group 8% on Wednesday as investors focused on financing risks across AI infrastructure, after Elon Musk replied 'Yikes' to a post about CoreWeave's bond yields. A chart shared by Chamath Palihapitiya showed the yield on $1.25 billion of CoreWeave's unsecured bonds maturing in 2032 reaching nearly 15% on Tuesday before closing at a record 14.5%. CoreWeave has raised more than $35 billion this year through chip-backed loans, high-yield and convertible bonds and share sales, with debt and lease obligations of about $52 billion at the end of June, per the Financial Times. Rising yields signal that investors want more compensation for lending to the company, which could make expansion costlier and pressure cash flow if demand or customer commitments lag spending. Demand for computing capacity remains strong, but investors are increasingly scrutinizing the debt needed to build data centers and buy Nvidia chips.
Related markets
Latest news
- The Nasdaq Crashed 700 Points in a Day Last Week. One Major Wall Street Firm is Predicting the Correction Will End After Midterms.
The Nasdaq plunged nearly 700 points in a single trading session as concerns about artificial intelligence spending rattled technology investors. One major Wall Street firm believes the correction could end after the 2026 midterm elections.
- Unitree Stock Jumps as Investors Bet Chatbot AI Will Finally Give Robots a Brain
Unitree shares have risen about two-thirds since Oct. 15, closing at 672 yuan on Monday and lifting the Chinese robot maker's market value to 271.8 billion yuan (about $40.8 billion). Founder Wang Xingxing said at an Oct. 22 conference that large models could break through in physical AI within one to three years, and investors are betting that chatbot-style AI will give robots the intelligence they lack. JPMorgan upgraded Unitree to overweight from underweight on Oct. 26 and raised its price target to 995 yuan. The article also notes that researchers have flagged security flaws, including audio and video data streaming to outside servers without users being notified.
- iPronics Names Co-Founder & Photonics Pioneer Dr. Daniel Pérez-López as CEO to Drive Commercial Scale for AI Optical Circuit Switching
iPronics has named co-founder and CTO Dr. Daniel Pérez-López as CEO, while investor Geoffrey Tate becomes Chairman of the Board. Tate has experience scaling technology companies from early growth through IPO to market leadership, and he also sits on the board of Ayar Labs. The move follows iPronics' $125 million Series B round, which included strategic participation from NVIDIA and venture capital firms. OCS is projected to grow to tens of billions by 2030 as AI data center connectivity shifts from copper to optical. The company is expanding its Valencia development center, its supply chain and operations in Taiwan, and its commercial teams in Santa Clara.
- DoorDash in advanced talks to acquire Instacart: WSJ
The Wall Street Journal reports that DoorDash is in advanced talks to acquire Instacart, which is valued at $17 billion, in a deal that could be completed in the coming week.
- Vertiv Simplifies High-Density AI Infrastructure Deployment Across Data Center Environments
Vertiv has introduced the Vertiv SmartIT solution, a pre-engineered architecture based on NVIDIA MGX and OCP ORV3 that integrates rack infrastructure, power conversion, direct-to-chip liquid cooling and monitoring in a factory-validated design. Factory validation reduces on-site integration work, and the solution is available now for AI deployments globally. It can be used in existing facilities, new builds, colocation and hyperscale environments without redesign, and it scales from a single rack to multi-rack deployments. Vertiv previously deployed SmartIT with NVIDIA to support the DGX GB300 and showed a demo unit with the HGX Rubin NVL8 at NVIDIA GTC Berlin in October.
- JetBlue posts bigger loss on fuel costs, but CEO says margins improving
JetBlue posted a third-quarter net loss of $257 million, wider than the $143 million loss a year earlier, as its fuel bill rose 61% to $868 million. CEO Joanna Geraghty said resilient demand and strong yields pushed revenue well above initial expectations, a momentum that has carried into the fourth quarter, while average fares rose more than 19% to $245.11. Shares jumped roughly 11% in after-hours trading Monday after falling to a new low, and the carrier ended the quarter with $2.2 billion in liquidity and $8.4 billion in total debt. The Wall Street Journal reported that a group of senior creditors is working with PJT Partners, while CFO Ursula Hurley said the company aims for at least $1 EPS and positive free cash flow in 2028. A judge blocked both the Spirit Airlines acquisition and the American Airlines partnership, and JetBlue now has a partnership with United Airlines.
Get the briefing on Telegram or Zalo
Join the Upside Telegram channel or Zalo group for the Vietnam stocks and gold briefing at 8:00 and 19:00 (Vietnam time) on trading days, plus a weekly wrap on Saturday morning.