CoreWeave Selloff Signals AI Debt Risk as Rates Rise

A sharp selloff in CoreWeave shares is exposing a growing vulnerability in the artificial intelligence trade: its heavy reliance on borrowed money. CoreWeave, a cloud computing company that provides infrastructure for AI developers, has seen its stock fall as borrowing costs climb. The company carries significant debt, making it especially sensitive to rising interest rates. This pressure point matters beyond one company. Many AI firms depend on debt to fund expensive data centers and high-performance chips. When rates rise, those costs grow, squeezing profits and investor confidence. The CoreWeave selloff shows how quickly higher rates can hit the AI sector's most leveraged players.