Neocloud data centre debt raises AI bubble fears

Data centre companies known as neoclouds, including CoreWeave and Nebius, are under scrutiny as investors question their financial stability, fueling fears of an AI bubble burst. Their debt totals tens of billions of pounds. These firms lease expensive computing hardware to major AI developers like Anthropic, OpenAI, and Meta, borrowing against long-term contracts and chips. CoreWeave has accumulated $35.1bn in debt, and its stock has fallen 25% in the past month, with similar declines at peers. Many neoclouds originated in crypto mining, pivoting to AI after ChatGPT's 2022 launch. Analysts predict most will fail or be acquired by 2030, with risks tied to Big Tech spending cuts and rising interest rates.