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CoreWeave’s dollar bonds dipped by 1.5- 3points on growing concerns over the sustainability of the AI infrastructure investment boom. Investors are increasingly questioning whether the enormous spending on data centres, semiconductors and computing infrastructure will generate sufficient returns. CoreWeave priced $3.7bn in convertible notes in September and launched a share sale programme of up to 35mn shares. These fundraising plans have raised concerns about leverage and potential shareholder dilution. The broader funding environment is also deteriorating, illustrated by the shelving of Nvidia-backed data centre operator Firmus’ planned $5bn IPO in Australia and SoftBank’s issuance of $4.5bn in high-yield debt at coupons of up to 9.75%. The IMF has warned that an AI investment slowdown, combined with rising yields, could pose wider financial stability risks. Although the selloff does not necessarily signal weakening AI demand, investors are shifting their focus towards monetisation, returns on invested capital and the ability of companies to finance expansion.
Its 9.25% 2030s dipped by 1.5 points to trade at 89.3, yielding 13.1%.
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