US neocloud stocks fall after Musk's post on shakeout
XLK•CoreWeave shares fell 2.5% and Nebius shares dropped 2.3% in premarket trading after Elon Musk said more than 200 neoclouds would face “death and consolidation.” Musk said SpaceX would not buy any neoclouds.
1. Musk warns of shakeout
Musk said debt markets had almost entirely shut off access to money for companies without substantial revenue independent of AI data centers, and predicted that more than 200 neoclouds would face “guppy-level death and consolidation.” He later called a SpaceX purchase of a neocloud “pointless.”
2. Shares extend declines
CoreWeave and Nebius fell 2.5% and 2.3%, respectively, in premarket trading. Neocloud stocks have sold off in recent weeks amid concerns that debt-fueled AI infrastructure spending was becoming unsustainable. CoreWeave was down nearly 25% year to date, while Nebius was up nearly 90% but well below its peak; IREN was down 34%.
