AI data centers are unpopular for good reason: they drive up utility costs for communities, crowd out everything from schools to family farms, and they’re bad for our health. But these data centers are also a financial crisis in slow motion.
The AI ecosystem is built on mountains of debt taken on not only by tech firms like Meta (which borrowed a record-breaking $25 billion in late 2025 to fund the building of data centers), but also by the companies that lease data center space to the Big Tech firms. Many of these firms have spent far more than they have come close to earning in profits: One estimate puts tech industry spending to build data centers at $1.9 trillion, but less than half of that money has been made in revenue.
The financial markets are taking notice.
There’s been significant turmoil in the tech sector over the past month — and at one critical company in particular: CoreWeave.
CoreWeave used to be a Bitcoin mining firm called Atlantic Crypto, but it started to pivot to AI in 2019. CoreWeave leases space to Big Tech firms at data centers they build and maintain. CoreWeave has paid for most of its data centers by borrowing: it currently owes more than $51 billion to investors, including two of the most infamous financial firms: Magnetar and Blackstone, as documented by journalist Elizabeth Lopatto at The Verge.
