CoreWeave CRWV and IREN shares are tumbling on Wednesday, with neoclouds coming under renewed pressure.
At 10:30 AM EDT, CoreWeave slipped about 8.6% while IREN dropped 10%.
Both the stocks surrendered a large portion of the previous session’s strong gains that had been fueled by CoreWeave’s upbeat quarterly results.
IREN shares had risen roughly 5.6% on Wednesday while CoreWeave had shot up close to 25%.
The broader market was mixed, with the Dow holding relatively steady while technology shares led declines on the Nasdaq and S&P 500.
Huang era over at Nvidia
The biggest pressure on the group stemmed from the fact that Nvidia founder and CEO Jensen Huang resigned on Thursday.
Chief Financial Officer Colette Kress was named interim CEO as the board searches for a permanent successor.
The development comes after Huang attracted intense scrutiny over reports of his two extramarital affairs.
One of these alleged affairs was with a Chinese businesswoman whom US intelligence has identified as an intelligence asset of Beijing.
Reports also emerged on Wednesday that Huang had another affair with a senior Nvidia executive who reported to him.
The resignation has the potential to shake the AI trade with Nvidia and Huang sitting at the heart of it.
CoreWeave, IREN and other “neocloud” operators depend heavily on a steady supply of Nvidia chips to expand their data-center fleets and fulfill their multi-year contracts with hyperscalers and AI labs.
Nvidia is also a strategic investor in several of these companies, including both CoreWeave and IREN.
Any uncertainty at Nvidia can send ripples through the neocloud sector, which is already under pressure amid mounting debt.
CoreWeave’s new debt plans
Investors were also assessing a Bloomberg report that CoreWeave was planning a fresh debt.
The publication on Wednesday said that CoreWeave is planning to raise at least $4 billion through a new investment-grade, chip-backed loan to finance additional Nvidia purchases.
The company already carries a very high debt load that has long been the central concern for investors.
While the proposed facility is structured around customer contracts and hardware and is expected to carry a lower interest rate than CoreWeave’s existing unsecured bonds, the fresh fundraising still highlighted the sector’s heavy reliance on leverage to fund rapid capacity growth.
Nebius under pressure
Shares of peer Nebius slumped as well, falling more than 10% after the company reported third-quarter results.
Revenue of $980.8 million sharply beat estimates and rose 571% year-over-year.
Management guided full-year 2026 sales to the low end of its prior range and significantly raised capital-expenditure plans to about $27 billion this year and $40-45 billion in 2027.
Those higher spending needs, even with strong customer prepayments, revived questions about funding and returns across the neocloud group.
AI disclosure: AI tools assisted with research and drafting of this piece. An Invezz editor reviewed the facts, sources and wording before publication. Any opinions or analysis are Invezz’s, not those of an automated system.
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