Business · Updated 16 Oct, 12:48 am IST
CoreWeave debt and spending raise doubts about AI chip-driven growth
Why it matters for readers: It explains why the AI hardware boom involves big bets and financial risk, not just technical progress.
- CoreWeave rents computing power from Nvidia processors to companies building and running AI, including Microsoft and OpenAI.1
- Data compiled by LSEG shows CoreWeave has about $50 billion in debt and has never turned a profit.1
- The company raised its annual capital spending forecast by $4 billion to a range of $35 billion–$39 billion.1
- Analysts expect nearly $13 billion in revenue this year and a loss of $2.13 billion, while yields on its 2031 bonds have jumped to about 16% and are rated junk.1
- Investors are worried despite the CEO saying the company has a strong contract backlog, contributing to a broader tech selloff.1
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