Bond Market Flags AI Infrastructure Risk as CoreWeave Yields Jump

CoreWeave's bonds have suffered a sharp sell-off, with yields jumping from 9.675% to around 15%, signaling rising market concern about AI companies' ability to generate returns on massive infrastructure investments. The AI data center operator's share price dropped over 30% in two weeks, reflecting investor scrutiny of spending versus revenue growth. A hypothetical $1 billion debt raise at current rates would cost roughly $150 million annually, up from $97 million previously. This mirrors the late-1990s telecom boom, when overly optimistic revenue forecasts led to bankruptcies despite necessary infrastructure. Credit spreads have widened 50 basis points, an early warning sign, though not yet indicating systemic stress.