'Yikes': CoreWeave stock tanks on bond yield woes, CEO blames market acting 'irrationally'
CoreWeave shares fell between 13% and 16% on Wednesday following a surge in bond yields that topped 15%. The decline follows a viral chart of the company's rising borrowing costs which prompted Elon Musk to respond with the word "Yikes." While the CEO claims the market is acting "irrationally" and has issued a memo to staff citing a strong backlog, investors are increasingly concerned about an AI borrowing binge. The slump is part of a broader rout in AI infrastructure firms fueled by a red hot CPI report and rising US rate hike bets.
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- ✓ CoreWeave shares fell more than 16% on Wednesday.
- ✓ Bond yields for CoreWeave have topped 15%.
- ✓ Elon Musk responded "Yikes" to a chart of CoreWeave's rising borrowing costs.
- ✓ CoreWeave CEO stated the market is acting "irrationally".
What changed
CoreWeave stock fell over 16% on Wednesday after Elon Musk reacted to the company's soaring bond yields.
Live updates
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CoreWeave stock plunges as bond yields top 15%
CoreWeave shares fell between 13% and 16% on Wednesday following a surge in bond yields that topped 15%. The decline follows a viral chart of the company's rising borrowing costs which prompted Elon Musk to respond with the word "Yikes." While the CEO claims the market is acting "irrationally" and has issued a memo to staff citing a strong backlog, investors are increasingly concerned about an AI borrowing binge. The slump is part of a broader rout in AI infrastructure firms fueled by a red hot CPI report and rising US rate hike bets.
Why it matters
CoreWeave operates as a neocloud provider building expensive computing infrastructure for artificial intelligence. The company is targeting "unlimited" insurance money to fund its build-out. Rising yields signal that creditors view the company's heavy debt load as a significant risk.
What is confirmed
- CoreWeave shares fell more than 16% on Wednesday.
- Bond yields for CoreWeave have topped 15%.
- Elon Musk responded "Yikes" to a chart of CoreWeave's rising borrowing costs.
- CoreWeave CEO stated the market is acting "irrationally".
- Nebius Group shares fell 8% amid broader pressure on AI infrastructure firms.
Still unconfirmed
- CoreWeave is targeting "unlimited" insurance money to fund its AI build-out.
- The CEO noted a strong backlog in a memo to reassure staff.
What to watch next
- Further US rate hike decisions following the CPI report
- Changes in CoreWeave bond yield trends
- Official company response to the distressed bond status
confidence 95%Sources used for this update (20)
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- CNBC — CoreWeave shares tumble as bond yields near 15% on concern about AI borrowing binge
- Bloomberg.com — CoreWeave’s Bonds Turn Distressed, Drawing ‘Yikes’ From Musk
- Financial Times — CoreWeave targets ‘unlimited’ insurance money to fund AI build-out
- Bloomberg.com — CoreWeave’s Brazen Dream Crashes Into Reality as Yields Top 15%
- Yahoo Finance — 'Yikes': CoreWeave stock tanks on bond yield woes, CEO blames market acting 'irrationally'
- MarketWatch — CoreWeave sparks worry about broader credit-market stress as its bonds tumble
- Reuters — AI infrastructure firms slump as US rate hike bets rise
- Yahoo Finance — CoreWeave’s Debt is a Death Wish
- Reuters — Red hot CPI report fuels AI rout
- CNBC — Traders pile into 'bubble puts' on CoreWeave as neocloud stocks plunge
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