A sharp deterioration in CoreWeave’s debt valuations has raised concerns over private credit’s growing exposure to AI infrastructure financing, with the company’s borrowing costs climbing to distressed levels amid mounting investor scrutiny, according to a report by Reuters.
The AI cloud infrastructure provider has approximately $50bn in debt, according to LSEG data, making it one of the largest borrowers linked to private credit financing for data centre and computing infrastructure.
The cost of insuring CoreWeave’s debt against default rose to approximately 1,200 basis points last week, while yields on some of its bonds reached 15%–16%, reflecting increased concerns over the company’s credit risk.
Private capital managers have played a central role in financing CoreWeave’s expansion. Magnetar Capital and Blackstone Tactical Opportunities led a $2.3bn GPU-backed financing facility in 2023, followed by a $7.5bn facility in 2024 involving Blackstone, Magnetar, Carlyle, BlackRock and other investors.
An additional $8.5bn financing facility raised in March 2026 was anchored by Blackstone Credit & Insurance.
The pressures come as private credit managers increase their exposure to AI infrastructure. Carlyle recently estimated that private credit could be required to finance approximately $1tn of the AI computing buildout, exceeding half of the industry’s current assets under management.
The firm reportedly warned that rapid capital deployment could create concentration risks similar to those experienced in software lending, particularly where financing depends on a limited number of customers or rapidly evolving technologies.
Some CoreWeave facilities are reportedly secured against GPUs and long-term customer contracts involving Microsoft, OpenAI and Meta. While contracted revenues can strengthen lenders’ security, concentrated exposure to a small number of technology companies creates additional risks if contracts are not renewed or demand weakens.
The repricing of AI infrastructure debt could prompt lenders to demand wider spreads, lower leverage, stronger covenants and tighter concentration limits on future transactions.
The concerns emerge despite record private credit fundraising. Direct-lending funds raised $129.15bn in the first nine months of 2026, up 35% year-on-year, according to Preqin.
However, estimated third-quarter direct-lending volumes fell 28% to $49.77bn, according to PitchBook/LCD, while competition from syndicated lenders intensified.
Approximately $16.39bn of direct-lending loans were refinanced in the broadly syndicated market during the quarter, compared with just $2.60bn moving in the opposite direction.
The divergence between fundraising and deployment highlights increasing competition for private credit investments, even as demand for financing AI infrastructure continues to expand.
