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Nvidia CEO Jensen Huang stated that the company does not need to backstop CoreWeave, noting the AI cloud provider's cost of capital is decreasing. CoreWeave's stock rebounded after tumbling 8.3% to $60.36, while its credit risk reached a record high with yields on its 2031 notes crossing 16%.
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Key sources
- SOURCE@reuters“CoreWeave's slump puts spotlight on debt behind AI boom”x.com
- SUPPORT@business“CoreWeave’s credit risk climbed to an all-time high Thursday as its high-yield bonds extended declines, rattled by the AI cloud-computing company’s plans to ramp up borrowing”x.com
- SUPPORT@kerrisdalecap“A year ago, we argued $CRWV failed finance’s most basic test: returns below its cost of capital. With shares halved and bonds yielding ~15%, the market is realizing the math doesn’t math”x.com
- SUPPORT@junkbondinvest“CoreWeave’s unsecured notes are officially 1,000bps STW, now yielding ~15%.”x.com
- SUPPORT@zerohedge“Coreweave unsecureds tag 1000 g-sprd bps for the first time ever.”x.com
- SUPPORT@melvininvests“Now Jensen is coming out and saying that $CRWV is getting stronger every single day, $NVDA doesn't need to backstop them, and CoreWeave's cost of capital is actually DECREASING.”x.com
- SUPPORT@stocksavvyshay“$NVDA CEO Jensen Huang says Nvidia “doesn’t need to backstop” $CRWV because its financial strength is improving and cost of capital is “actually decreasing.””x.com
- SUPPORT@tengyanai“A lot of talk about $CRWV's 2031 bond yield crossing 16%. Yet it has $104B in reported backlog.”x.com