For years, the companies behind America's artificial-intelligence boom have raised hundreds of billions of dollars with ease. Wall Street eagerly ponied up capital and asked few questions.
Now, the balance of power is shifting.
Lenders and investors are getting choosier about where to place their bets and are demanding tougher terms, signaling a new phase in the AI build-out. Among their concerns: the prospect of delays in big projects as a grassroots political backlash to data centers gains traction, and the threat that AI-related profits from hyperscalers and startups such as Anthropic and OpenAI won't materialize as fast as promised.
Plus, a flood of stock and bond offerings is compounding concerns that investors are getting overexposed to AI.
The new terms of trade are visible in every corner of markets. Bonds issued even by big tech companies such as SpaceX and Meta are trading at steep discounts. AI cloud companies such as CoreWeave, Nebius and Nscale that borrow big to build and sell capacity have effectively been shut out of the bond market in recent weeks, people familiar with the matter said.
Taken together, it all amounts to a buyer's market for Wall Street. Even powerful players such as Broadcom are having to sweeten the terms offered to banks to secure loans. "The bar is going higher and higher in terms of proving to lenders that this investment will turn into sufficient revenue," said Dan Ivascyn, chief investment officer at Pimco. "The weak links are going to suffer first."
Raising money in equity markets isn't much easier. Nscale's hopes of going public next month have been thwarted, while rival Lambda dialed back the valuation it was seeking in a new fundraising round, people familiar with the matter said.
The stock market is starting to reflect investors' nervousness that the AI payoff might not arrive -- at least in the near term. Disappointing earnings reports from technology companies this week prompted a rout in AI-related stocks and bonds, leading Friday to one of the biggest market selloffs since AI-mania began. Google parent Alphabet sustained its largest stock market wipeout ever Thursday, losing roughly $500 billion in market value, after quarterly results showed revenue from its core search business slowing while spending on AI infrastructure continues to surge.
Tremors in the market also shook chip-maker Intel, which saw its share price plummet 29% on Friday after the company reported weakness in its personal computer business. The tech-heavy Nasdaq composite dropped 2.9% on Friday, its worst day since June. If the volatility continues, fundraising could grow even harder.
There is still money available for creditworthy companies. SpaceX this week announced it raised the biggest-ever financing for AI chips, a $40 billion package that will allow it to purchase the latest lineup of Nvidia chips.
Its record only lasted a few hours, when chip-design giant Broadcom sealed a $63 billion deal to lease chips to Anthropic. But even that deal showed the strains of the current environment: Broadcom Chief Executive Hock Tan had to personally intervene in negotiations at the last minute to calm banks' nerves.
Even companies that can raise money fret about their suppliers' ability to do so. Anthropic is aiming to raise up to $100 billion in a mid-November offering. In its IPO prospectus unveiled this week, it called out as a risk factor the financing constraints for the electrical-power providers its data centers rely upon.
Meta cited a desire to beat competitors to the punch when it unveiled a plan to raise up to $97.5 billion through a series of new stock offerings. In a securities filing, it pointed to recent and future offerings from the likes of Alphabet, SpaceX, Anthropic and OpenAI as challenges to the depths of capital markets.
"Everybody is trying to raise money for their build-outs before the liquidity dries up," said Ben Connard, chief investment officer of Carnegie Investment Counsel.
"Ultimately, there might not be enough money to fund this build-out," he said. "Financing could be the ultimate crunch that slows things down."
Customer advances
In the years since ChatGPT launched, AI companies have consumed every source of capital they could find, tapping venture capitalists, stock pickers, bankers and managers of bond and private-credit funds.
Across all types of U.S. corporate debt markets, AI-linked issuance totaled $394 billion in 2025 and $655 billion through mid-October of this year, according to Bank of America. Next year, analysts forecast nearly $1 trillion of fresh AI-linked debt.
Among the most prolific participants in capital markets are so-called neoclouds, companies that own or lease data centers, outfit them with fleets of AI servers and sign contracts to sell computing power to big tech companies, trading firms and AI startups. They are also the most sensitive in the AI sphere to rising interest rates, since their borrowing costs were already elevated before recent turmoil in the market.
Many neoclouds started out as cryptocurrency mining outfits, and most of them have scant histories operating AI infrastructure. Nebius was once the Amsterdam-based company behind Yandex, Russia's top internet company. It divested its main assets following Moscow's invasion of Ukraine and pivoted to providing AI cloud-computing services a little over two years ago, striking contracts with tech companies including Meta and Microsoft.
Since 2024, Nebius has sold some $2.7 billion in stock to Nvidia and other investors and issued billions more in convertible bonds for its AI expansion. But its thirst for capital continues. Over the summer and early fall, Nebius's bankers arranged for company executives to meet with fund managers in advance of a potential high-yield bond offering, people familiar with the matter said. It would have been Nebius's first.
By September, debt markets started to wobble. The Federal Reserve raised short-term interest rates for the first time in three years. Challenges over power supply and permitting prompted Oracle to notify the developer of a huge New Mexico data center it previously agreed to lease that it was pushing back the date at which it would pay full rent. That prompted lenders everywhere to re-evaluate construction risk on their projects.
Bonds issued by CoreWeave at a 9.75% rate earlier this year now trade at a yield above 15% in the secondary market, an indication of how much more expensive it has become to borrow over a short period. Bankers cautioned in recent weeks that the high-yield market for neoclouds was essentially shut for new offerings. Yields of 15% or more would be prohibitively expensive for borrowers.
Nebius decided against pursuing a high-yield offering. CEO Arkady Volozh has said his company is having to be increasingly creative to secure the funds needed for its build-out. That includes getting prepayments from its customers.
"From last week, probably some of the capital sources are temporarily closed, like the asset-backed or debt market," Volozh said last week at a conference in Berlin. "But we're working now with customer advances and several other instruments, which will probably provide us enough finance to build this gigawatt at least."
Ophir Nave, chief operating officer of Nebius, said that despite Volozh's comments, the asset-backed financing market remains open, and the company plans to tap it in the future. Whether the company issues high-yield debt will depend on interest rates and the deal terms available to the company, he said.
Equity investors are getting spooked, too. Lambda, which is seeking to raise $4 billion in a final round of pre-IPO fundraising, recently reduced its target valuation from $14.5 billion to $13 billion after investors including tech investment firm Coatue decided not to participate, according to people familiar with the matter.
UK-based neocloud Nscale, which counts former Meta executives Sheryl Sandberg and Nick Clegg as board members, is preparing to go public in the coming months. The company had circled multiple dates on the calendar in November as possible candidates for its IPO, but is now leaning toward December given turbulence in the market, according to people familiar with the company's plans.
Another factor: Nscale is still negotiating with Nvidia and other investors to provide financial backing for a $45 billion data center for Anthropic in West Virginia, according to people familiar with the matter. After the market turned, Nvidia and the other potential backers began demanding more stringent terms, these people said, delaying Nscale's plans to file a revised IPO prospectus. All the uncertainty has convinced Nscale executives that it would be difficult to go public before Anthropic does. Some of the company's bankers have advised Nscale that it's unlikely to attract enough demand in an IPO to achieve the $30 billion to $35 billion valuation they had been targeting, according to people familiar with the matter.
Concentration risks
The largest AI hyperscalers sit on the opposite end of the credit risk spectrum from the neocloud companies, but the sheer scale of their fundraising plans is starting to cause problems.
Meta, Amazon, Alphabet and Microsoft carry top credit ratings and have significant room to pile debt on their balance sheets. But after many of them flooded the high-grade debt market with new bond sales this year -- and signaled they plan to keep doing so for the foreseeable future -- the investment firms, insurance companies and pension funds that lend to them are feeling increasingly tapped out, and concerned about their concentration in one sector.
"There's just the practical question of, how full can investors get on one name, or one theme?" said Pimco's Ivascyn.
Prices of bonds issued by several hyperscalers dropped near record lows on Friday, and have fallen to the point where their yields -- which move inversely -- are significantly higher than those of typical investment-grade corporate bonds.
Watch: How Anthropic Beat OpenAI to Wall Street
Purely from a cost of capital standpoint, Meta likely would have preferred to borrow money rather than sell new equity as it did earlier this week, said Brij Khurana, a fixed-income portfolio manager at Wellington Management.
"The institutional asset management community has been pushing back on the hyperscalers from issuing too much debt," he said. "That's why you've seen a number of big equity transactions take place."
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