Nvidia CEO Jensen Huang says CoreWeave doesn't need a backstop, cost of capital decreasing; AI selloff eases
What happened
Nvidia CEO Jensen Huang, speaking to Bloomberg at an event in Stockholm on Thursday Oct 15, said CoreWeave does not need a financial backstop from Nvidia. 'CoreWeave's strength is improving every day,' Huang said. 'I'm optimistic. Their cost of capital is actually decreasing.' The remarks came a day after CoreWeave's stock plunged 15% and the yield on its 9.625% notes due 2032 spiked to 15% as credit markets repriced its debt risk, and after Jefferies argued Nvidia should provide financing backstops to the neocloud ecosystem. Huang's comments helped cool the AI selloff intraday: CoreWeave narrowed its Thursday decline, Oracle swung from a deep loss to a gain, and the major indexes recovered much of their early losses.
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Start your free 14-day trialWho’s affected
- NVDA (Nvidia) - supplier, customer and ~13% investor in CoreWeave; Huang's remarks are the direct catalyst
- CRWV (CoreWeave) - stock cut its Thursday decline from an intraday low of $59.51 to $63.44 (-3.6%) after the remarks
- ORCL (Oracle) - recovered from a $127.60 low to +1.7% at $132.75 as AI-debt fears eased
- Neoclouds NBIS (Nebius) and IREN - still down sharply Thursday (Nebius -5.2%, IREN -8.7%) but off panic lows
- Semiconductors (SOXX) - rallied more than 2% off its lows; NVDA itself still down about 2% on the day
- Broad AI trade / Nasdaq - Nasdaq pared its decline to -0.4%, S&P 500 back to +0.1%, Dow up 500 points (+1%)