CoreWeave credit default swaps signal distress as AI debt worries grow

CoreWeave's credit stress intensified Thursday as investors grew increasingly concerned about AI-related debt, with its credit default swap spreads soaring above 1,140 basis points, signaling distress. The neocloud company holds over $51 billion in debt and obligations for AI infrastructure. Its 9.75% bond due 2031 saw yields climb to 15.78%, while five-year CDS spreads jumped 33% week-over-week. CoreWeave's stock fell again after Wednesday's 15.5% drop, with peers Nebius and Iren also declining. CEO Mike Intrator dismissed the market moves as irrational, citing a $100 billion backlog with investment-grade clients. However, analysts warned concerns could become a self-fulfilling prophecy, with Oracle's CDS spreads also spiking this week amid broader AI overspending fears.