CoreWeave’s borrowing costs just fell from 10% to 7%. The AI data centre debt market is repricing risk in real time.
TL;DR
Applied Digital raised $1.59 billion in junk bonds at 7% yield for a CoreWeave data centre, down from 10% six months ago. CoreWeave’s credit default swap spreads fell 49% from their December peak.
An Applied Digital subsidiary raised $1.59 billion in the high-yield bond market on Tuesday to fund a fourth building at its Polaris Forge 1 campus in North Dakota, which will provide 150 megawatts of computing capacity for CoreWeave under a 15-year contract.
The bonds were priced to yield 7%, a steep drop from the 10% investors demanded for an earlier portion of the same project in November. The offering attracted five times its size in demand.
Why the pricing gap closed
The cost of protecting CoreWeave’s debt against default for five years fell to as low as 4.52 percentage points earlier this month, down from a peak of 8.81 percentage points in December 2025. That 49%...
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