CoreWeave’s bonds sold off for a second consecutive session on Wednesday, pushing yields above 15% as investors reassessed the debt supporting the artificial-intelligence infrastructure boom.
Longer-term Treasury yields then reversed lower as concern about AI-related borrowing prompted a flight to safer government debt. That sequence left Treasury yields down even as the corporate-bond rout highlighted rising financing costs for riskier technology borrowers.
Because bond prices and yields move in opposite directions, the jump indicated a sharp decline in the market value of the company’s existing debt.
The market reaction followed a rapid expansion of CoreWeave’s balance sheet.
Oracle has also been raising large sums to finance its AI cloud expansion.
Estimates cited in market coverage put hyperscaler spending at roughly $800 billion this year and more than $1 trillion annually by 2027, increasing the importance of borrowing conditions to the sector’s expansion.
CoreWeave Chief Executive Michael Intrator told employees that markets can misread companies building a new type of technology and said he remained confident in the company’s business model. The immediate cause of the bond selling was not established, but the combination of higher interest rates, heavy borrowing and falling prices showed how quickly stress in AI-linked credit can spill into equities and, briefly, redirect money toward Treasuries.