Topic
Corporate debt rated below investment grade, also called junk bonds, which pays higher interest to compensate for greater default risk.
CoreWeave's 2031 bond yield passed 16% and the cost to insure its debt topped 1,000 basis points, a record. The strain sits on one loss-making borrower, and the sources do not show it spreading across AI infrastructure.
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SoftBank sold a record $11 billion of junk bonds at yields up to 9.75%, Reuters reported. Its 2034 bond pays 4.55 points over Alphabet's 2033 issue, a premium Reuters ties to SoftBank's own risk and concentration.
Reality
SoftBank sold $11.1 billion of high-yield bonds, a record by CNBC's count, to pay the final $10 billion of its $30 billion OpenAI commitment. The debt sits with a BB+ borrower, so credit conditions reach OpenAI's money through one investor's balance sheet.
Reality
SoftBank paid the last $10 billion of its OpenAI commitment on October 1, taking its total to $64.6 billion for about 13% of the company. It funded the payment with new senior notes, so a stake worth roughly $110 billion at February's price is now carried on bond debt.
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Low-rated companies have raised $88 billion for AI deals this year, Goldman Sachs figures show, and lenders now check revenue before they lend. Credit goes first to borrowers with long contracts and hard assets, so a small AI vendor's cost of debt shows buyers how lenders rate its staying power.
Reality
SoftBank is marketing junk bonds at yields up to 9.875% to raise more than $11 billion toward nearly $65 billion of OpenAI commitments. The yields are the company's highest ever at those maturities, and high-yield buyers are still competing to lend at them.
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Ten billion dollars of notes plus a billion in euros price around September 24 to fund a commitment approaching $65bn. The 13% stake SoftBank is targeting implies a valuation well below the $730bn cited.
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