On Thursday, AI cloud service providers continued to suffer steep declines, with NEBIUS (NBIS.US) falling more than 10% and ranking among the worst performers on the Nasdaq 100 index, while CoreWeave, Inc. (CRWV.US) dropped over 7% and has now lost roughly 25% so far this week.

The five-year credit default swap (CDS) spread for CoreWeave, Inc. (CRWV.US) widened by 135 basis points to a record high of 1,117 basis points, implying a roughly 63% probability of default within five years.

CoreWeave, Inc. (CRWV.US) CEO Michael Intrator attributed the market reaction to a "misjudgment" in an internal memo, stating that the company is fully confident in its business model. However, after the memo was issued, the CDS spread continued to widen to the aforementioned record level.

The credit market's pricing of default risk for CoreWeave, Inc. (CRWV.US) has continued to surge, and well-known research firm Gartner has warned that more than 80% of emerging cloud service providers, known as neoclouds, will be unable to survive independently by 2030.