TLDR
- CoreWeave, Nebius and IREN fell about 2.5% in Sunday overnight trading and more than 4% in Monday premarket.
- Elon Musk said debt markets have shut off money for firms without substantial revenue outside AI data centers.
- Musk predicted that more than 200 neoclouds face “guppy-level death and consolidation.”
- CoreWeave, Nebius and IREN each lost between 33% and 39% in October.
- Analysts still rate all three stocks as buys, with price targets well above Friday’s closing prices.
Shares of CoreWeave, Nebius and IREN fell after Elon Musk warned that many neocloud companies could fail. The three stocks dropped about 2.5% in Sunday overnight trading. They fell more than 4% in premarket trading on Monday.
CoreWeave, Inc. Class A Common Stock, CRWV
Musk posted his warning on X on Sunday. He said debt markets have almost entirely shut off access to money for any company that does not have substantial revenue independent of AI data centers.
As someone with a portfolio of energized land assets here is what I am seeing:
1. Neoclouds are disorganized and poorly capitalized. Some are definitely better than others however.
2. Hyperscalers are intractable, bureaucratic organizations that take 3 months to do an NDA and… https://t.co/Zx23fRCYvW
— Chamath Palihapitiya (@chamath) October 25, 2026
He added that the 200 or more neoclouds are going to see “guppy-level death and consolidation.” He said some will make it through, but not many.
Musk Points to SpaceX Financing
Musk’s warning came as he said SpaceX had closed a $40 billion debt financing arrangement for Nvidia GPUs. He said the company got the financing because of its investment-grade status. He also pointed to its revenue from satellite internet and rocket launches.
Musk predicted that many neocloud firms would disappear or combine with rivals. He ruled out SpaceX buying any of them.
The comments matter to CoreWeave, Nebius and IREN. All three are spending billions on AI computing infrastructure and rely heavily on outside financing.
Pressure on Each Company
CoreWeave shares have dropped 38% in October. The Nvidia-backed company has about $50 billion in debt. Yields on some of its bonds have climbed toward 16%.
The company has a revenue backlog of more than $100 billion at the end of the second quarter. CEO Mike Intrator has said contracted revenue more than covers its debt. Investors remain concerned about the timing of future cash flows.
Nebius shares have fallen 33% in October. Last Thursday, the company announced a $3.5 billion financing facility from Citi. The money is meant for data center construction and GPU purchases.
Nebius is working to deliver computing capacity under multibillion-dollar agreements with Microsoft and Meta. Its planned capital spending runs into tens of billions of dollars.
IREN shares have dropped 39% in October. The company is moving from Bitcoin mining toward AI cloud infrastructure. It expects to spend between $25 billion and $30 billion during fiscal 2027.
IREN has said customer prepayments and debt financing can cover much of that spending. Rising borrowing costs could make the plans more expensive.
Wall Street still rates the stocks favorably. CoreWeave has a Moderate Buy consensus, with an average price target of $133.25. Nebius also has a Moderate Buy rating, with an average target of $302.09.
IREN has a Strong Buy rating based on 8 Buys and 2 Holds. Its average target is $82.56. CNBC reported that after-hours, CoreWeave was down 2.96%, Nebius was down 3.36% and IREN was down 3.03%.
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