CoreWeave stock is tumbling amid fresh data-center financing concerns

Core Points - CoreWeave stock experienced a decline of up to 12% on Friday, despite being up approximately 19% year to date [1] - The decline was triggered by a report indicating that Blue Owl Capital could not secure debt financing for a data center co-developed with CoreWeave, which is located in Pennsylvania [2] - Lenders are hesitant to finance AI firms with below-investment-grade credit, as CoreWeave's debt is rated B+ by S&P Global Ratings, significantly below investment grade [2] - Concerns have been raised regarding the sustainability of CoreWeave's business model, which relies on renting compute power to AI customers, especially given its high debt-to-equity ratio [3] - The enthusiasm for AI has diminished over the past six months, further impacting investor confidence in CoreWeave [3] - A proposed merger between CoreWeave and Core Scientific fell through due to opposition from a major shareholder, raising additional concerns about CoreWeave's financial health [4] - Notable short-seller Jim Chanos has expressed skepticism about CoreWeave's financials and profitability, advising caution for investors in data center stocks [4] - Blue Owl Capital has also been in the news for halting redemptions on one of its private credit funds aimed at retail investors, indicating potential liquidity issues [5]