CoreWeave carries about $50 billion in debt with bonds pricing in a 63% five-year default risk, while Applied Digital's interest bill now nearly matches its entire annual revenue. Nscale's IPO valuation was cut nearly in half after Microsoft walked away.
AIHUB
Obscure neocloud lenders, not NVIDIA, are where the AI bubble could burst first
The article highlights financial stress among neocloud providers, with CoreWeave carrying about $50 billion in debt and bonds pricing in a 63% five-year default risk. Applied Digital's interest expenses now nearly match its annual revenue, and Nscale's IPO valuation was cut nearly in half after Microsoft withdrew. These signs suggest the AI bubble may burst first in the lending sector rather than at chipmakers like NVIDIA.
Provides concrete financial risk indicators for AI infrastructure lenders, offering a contrarian perspective on where the AI bubble might burst.
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