AI cloud company CoreWeave is reportedly seeking a debt raise of approximately $1.5 billion.
The debt financing comes just weeks after CoreWeave’s initial public offering (IPO) brought in significantly less capital than was originally expected.
First reported by the Financial Times and citing “people familiar with the matter,” CoreWeave was said to have last week held a “roadshow” with bankers from JPMorgan for debt deals expected to include a high-yield bond offering.
According to the FT, the meetings were to gauge investor interest before CoreWeave would make a final decision on the size of the deal, but it is likely to surpass $1.5bn.
The sources told FT that the refinancing would reduce CoreWeave’s debt pile in public credit markets to lower its cost of borrowing, and that the funds would be used to further invest in CoreWeave’s operations.
CoreWeave and JPMorgan declined to comment to the FT.
The AI cloud company began trading on the Nasdaq stock exchange on March 28, offering shares at $40 each and giving it the potential to raise up to $1.5bn with the IPO – $4bn less than previously mooted for the offering. The shares are currently valued at $51.37 and peaked in early April at more than $60 per share.
According to the FT, around $1bn of the proceeds from the IPO were used to settle a bridge loan from a consortium of banks led by JPMorgan.
CoreWeave has raised billions of dollars in equity funding and billions more in debt financing in the last two years to fund its expansion plans, including a $650m investment round in November 2024.
As of December 2024, the company had around $8bn in total debt on its balance sheet, the majority of which was raised in private credit deals with the likes of Blackstone and Magnetar Capital and with interest rates between 11 and 15 percent. The FT has previously reported that CoreWeave is facing debt and interest payments of $7.5bn by the end of 2026. That debt is secured by CoreWeave’s stock of Nvidia chips, and its contracts with customers, including Microsoft.
CoreWeave was originally founded in 2017 as a cryptomining firm, though it later pivoted to offering an AI cloud. At the end of 2024, it had 32 data centers operating more than 250,000 GPUs in total and more than 360MW of active power.