CoreWeave is preparing to raise at least $4 billion through a new loan offering with an investment-grade rating, as the AI infrastructure provider looks to secure funding at potentially lower borrowing costs following an improved revenue outlook, according to Bloomberg.
Morgan Stanley and Mitsubishi UFJ Financial Group are reportedly leading the financing. People familiar with the matter told Bloomberg that the loan could be offered to investors in several stages and may launch as early as next week. However, the terms and timing remain subject to change.
CoreWeave shares dropped 6.1% in extended trading.
The planned financing comes as CoreWeave continues to rely heavily on debt to fund its expansion of AI computing infrastructure. Although the company has traditionally tapped the high-yield debt market, it has also used its GPUs and related customer contracts as collateral to obtain more favorable financing terms. A similar structure could support the latest loan offering.
CoreWeave recently raised its full-year revenue forecast to between $13 billion and $13.3 billion, above both its previous guidance and Wall Street's average estimate of approximately $12.9 billion. Company executives also indicated that another investment-grade loan could be arranged in the near future.
The financing will be closely watched by investors as concerns persist over the sustainability of the massive capital spending required to build AI infrastructure. CoreWeave, which supplies computing capacity to major technology companies including Meta Platforms, has become a prominent player in the AI infrastructure market, but its substantial debt obligations have also drawn scrutiny.
Following the improved financial outlook, CoreWeave shares surged on Wednesday, while its bonds also gained, reflecting stronger investor sentiment toward the company.