CoreWeave CDS top 1,140 bps as $51 billion AI debt alarms investors
Why it matters: A CDS spread above 1,000 basis points is widely seen as distress, and CoreWeave bonds and AI-linked stocks also fell.
CoreWeave’s credit stress deepened Thursday as investors dumped its debt and shares amid mounting concern over heavy borrowing tied to the AI buildout. The company has taken on more than $51 billion of debt and obligations to fund chips, data centers and computing capacity. Its five-year credit default swap spread briefly rose above 1,140 basis points and was last at 1,088, up 33% from a week earlier and 177% from a year ago. The yield to maturity on CoreWeave’s 9.75% bond due 2031 climbed to 15.78%. The sell-off spread across AI-related names, with Nebius down 5%, Iren off 8%, Micron Technology down 4% and Advanced Micro Devices losing 6%. CEO Mike Intrator told staff the company’s backlog exceeds $100 billion and supports its debt obligations.