CoreWeave Share Drop Sparks AI Bubble Fears as Debt Levels Climb

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  Newsroom

• December 17, 2025

• Newsroom

CoreWeave Share Drop Sparks AI Bubble Fears as Debt Levels Climb

CoreWeave, one of the most closely watched companies in the artificial intelligence infrastructure sector, has lost approximately $33 billion in market value over the past six weeks, as investor concerns mount over rising leverage, infrastructure costs, and potential signs of overheating in the AI market.

The selloff comes as the company continues to accelerate heavy investments in high-density data centers designed for AI workloads, while facing construction delays at facilities in Texas, according to market sources.

Recent figures show CoreWeave’s debt-to-equity ratio has reached roughly 120%, a level well above industry peers, which typically operate with leverage ranging between 7% and 23%. The sharp contrast has intensified scrutiny over the sustainability of CoreWeave’s expansion strategy.

Market participants also point to mixed messaging from company leadership, including comments from the CEO regarding future timelines and capital requirements, which have contributed to a noticeable shift in investor sentiment—from strong optimism to increased caution.

“The long-term fundamentals for AI infrastructure remain solid, but investors are beginning to distinguish between sustainable growth and expansion driven by aggressive leverage,” said one analyst cited by financial media.

CoreWeave has been a major beneficiary of the global race for AI computing capacity, fueled by demand for large language models, cloud services, and enterprise AI adoption. However, the recent market reaction underscores a broader Wall Street debate over AI bubble risks, particularly among companies relying heavily on debt-financed growth.

Despite the recent correction, analysts note that AI infrastructure remains a strategic sector. Still, they caution that markets are likely to demand greater financial discipline, clearer communication, and stronger execution visibility in the quarters ahead.

Sources: Reuters, Bloomberg,Financial Times, CNBC