How to Play the Brutal Selloff in CoreWeave Stock

Artificial intelligence (AI) has unleashed one of the biggest infrastructure spending booms in history, transforming demand for computing power, advanced semiconductors, data centers, and electricity. Billions of dollars in borrowing have helped fund the infrastructure underpinning the AI boom. Now, persistent inflation and rising interest rates threaten to make that expansion more expensive, a shift that has been particularly harsh for neocloud providers.

CoreWeave (CRWV) finds itself at the center of that reassessment. Shares of CoreWeave have plunged 38% over the past month as debt concerns have intensified and the company’s bonds weakened. Yields on some unsecured notes climbed to around 15%, and the cost of insuring its debt against default surged beyond 1,000 basis points. According to Reuters, these credit-market signals imply a roughly 63% probability of default within five years.