Lenders' Yield Spike Raises Concerns Over CoreWeave Debt, Nvidia Exposure Remains Limited
CoreWeave's bond yields rose to around 14.5% as investors demand higher returns, while Nvidia's financial ties to the cloud provider appear modest relative to its earnings.
Investors in CoreWeave's unsecured notes due 2032 have pushed yields up to roughly 14.5% after the price of the bonds fell, indicating a higher cost of borrowing for the AI-cloud company. The rise follows a June issuance of $1.25 billion of notes with a 9.625% coupon. CoreWeave's shares fell about 15% on the same day, and Nvidia, a major chip supplier and shareholder, slipped about 3% to around $221.
CoreWeave reported second-quarter revenue of about $2.6 billion, more than double the prior year, but posted an operating loss of $49 million and net interest expense of $640 million, more than twice the previous quarter. Total debt stood at approximately $35.6 billion at mid-year, reflecting ongoing borrowing to acquire AI chips.
Nvidia holds roughly 47.2 million CoreWeave shares, valued at about $3.1 billion at the latest share price, down from $4.7 billion six months earlier. The two firms also signed a capacity agreement in September 2025 worth an initial $6.3 billion, obligating Nvidia to purchase any unused cloud capacity from CoreWeave through April 2032.
Nvidia's latest filing disclosed $36 billion in commitments with AI cloud partners and up to $3.5 billion in lease guarantees, without specifying the portion linked to CoreWeave. The company reported $63.7 billion in operating income for the second quarter of fiscal 2027, indicating ample capacity to absorb potential setbacks at CoreWeave.
Analysts note that broader tightening of credit for debt-financed AI cloud providers could affect demand for Nvidia's chips, but the current market price reflects some of that risk, with a price-to-earnings ratio near 14 based on projected 2028 earnings.