AI infrastructure might be the hottest trade on the screen, but the way it's being financed is a lot less glamorous.
CoreWeave Inc (NASDAQ:CRWV) just announced a $2 billion private offering of convertible senior notes due 2031 — and the stock promptly slid as much as 6%–9% today, a sharp reminder that the AI boom is increasingly being built on IOUs.
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CoreWeave Hits The Convert Button
CoreWeave's deal adds another chunky layer of debt to a balance sheet already under scrutiny, with an option for initial buyers to take an extra $300 million in notes. Management says it's about funding more AI capacity, building out its "essential cloud for AI" model and keeping up with demand from hyperscale customers.
The market's early verdict? More cautious than excited. Shares fell sharply on the news as traders immediately started running the future-dilution math rather than celebrating another growth headline.
Read Also: CoreWeave To Double Down, Captures Microsoft And Google’s AI Dollars
The Pattern: Nebius, IREN, SMCI All Did This Too
CoreWeave isn't alone. Nebius Group NV (NASDAQ:NBIS) has already raised about $2.75 billion in convertible senior notes alongside a $1 billion equity offering to fuel its AI cloud build-out.
Read Also: Nebius Set To Join Meta, Oracle In The AI Debt Club
IREN Ltd (NASDAQ:IREN) followed with $2 billion of long-dated convertibles, paired with equity and debt-refinancing moves to fund new AI data centers.
Super Micro Computer Inc (NASDAQ:SMCI) went down a similar path earlier this year with a multibillion-dollar convertible deal that also triggered a sharp, immediate share-price hit.
Each story is slightly different, but the playbook rhymes: raise big, call it "growth capital," and let tomorrow's shareholders worry about how much of the upside they still own once the notes eventually convert.
The Quiet Fine Print: Dilution Risk
Convertibles are clever until they aren't. They let AI infra players tap huge pools of capital with low coupons and delayed dilution — but if the stocks work, those bonds are designed to become equity. That means more shares, lower percentage ownership for today's bulls and potentially heavier volatility around future conversion windows.
In other words, CoreWeave's move fits neatly into an emerging AI-infrastructure theme: the story everyone's chasing is explosive growth; the subplot they're ignoring is who ends up footing the bill for it.
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