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CoreWeave is preparing to raise approximately $1.5 billion in debt that New York-listed artificial intelligence data center operators can use to refinance some of its massive debt just a few weeks after a calm reception from investors.
According to people familiar with the issue, the US group is holding a roadshow with JPMorgan bankers and bankers this week.
People said CoreWeave executives intend to use the meeting to assess investors’ interests before determining the final size of the transaction.
But early consultations with investors and bankers could point to groups leasing computing capabilities to technology companies building AI models, and could raise more than $1.5 billion.
Those familiar with CoreWeave’s plans said refinancing of large debt piles in the public credit market will allow CoreWeave to reduce borrowing costs by refinancing at lower fees. One person close to the company added that they could use the funds to invest more in the business.
The New Jersey-based company listed its shares in March during an early public offering that was significantly reduced. Initially, the company aimed to raise between $4.7 billion and $55 per share, but it cut it to $1.5 billion at $40 per share, following investors’ massive burdens and investor concerns about the softening market for AI infrastructure.
The shares reached $55 per share on Thursday as the market remained bullish against the growth of the AI market.
CoreWeave has grown rapidly in the past two years amid an explosion in AI. That revenue skyrocketed from $16 million in 2022 to $1.9 billion last year.
However, the company has borrowed extensively to drive growth and raised $12.9 billion in debt over the past two years, building a data center as demand for the products and services operated by generation AI is booming.
CoreWeave had a balance sheet of approximately $8 billion in its balance sheet as of December 2024. The majority were raised through personal margin transactions between investors such as private equity groups Blackstone and Hedge Fund Magnetar Capital and 11-15% of investors.
Approximately $1 billion in IPO revenue was allocated to settle bridge loans from a consortium of banks led by JPMorgan. FT also reports that CoreWeave is facing $7.5 billion in debt and interest payments by the end of 2026.
Its liabilities are protected from a portfolio of over 250,000 NVIDIA AI chips and contracts with customers such as Microsoft.
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Nvidia is also one of CoreWeave’s biggest investors, owning about 5% of the company, but is one of the largest suppliers and customers. Chip Giant also bought $250 million in shares at the IPO.
The pitch deck for potential credit investors seen by the Financial Times showed that the bonds will be issued by the parent company CoreWeave, not its subsidiary.
Previously, CoreWeave has created special purpose vehicles for large loans that are protected against assets such as computing chips and customer lease agreements. People close to this issue said that unlike almost all existing loans, the new debt is unsecured.
CoreWeave and JPMorgan declined to comment.
