John Lloyd, global head of multi-sector and corporate credit at Janus Henderson, holds CoreWeave 9.75% bonds due in 2031 in the Multi-Sector Income Fund, with the debt now offering a 15.97% yield to maturity. CoreWeave has roughly $51.6 billion in total debt, while its debt-to-equity ratio climbed from 290% to 702% in a year; its stock fell 20% over the past week and its credit default swap spread reached 1,081 basis points. Lloyd believes the bond sell-off reflects excessive market reactions to higher US rates rather than a fundamental deterioration in the company. He expects the lack of near-term maturities and improving operating cash flow to help finance the data centers, with possible funding through customer prepayments, GPU-backed borrowing and new capital raises. Revenue, EBITDA and investment forecasts nevertheless point to substantial financing needs, which successful IPOs by Anthropic and OpenAI could help ease.
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