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Welcome, Weekenders! Whenever I’m the slightest bit ill, I take to my bed and mope. If it goes more than a day or so, I assume the worst—that the end is nigh. I can’t honestly remember the last time I felt unwell for more than a couple days, but I imagine such a scenario would probably find me consulting ChatGPT about burial shrouds. So I’d like to extend a smidgen of sympathy to CoreWeave CEO Mike Intrator. Surely, he’s been feeling poorly for nearly two weeks! In the last 12 days, CoreWeave’s stock has been nearly halved. A confluence of factors has contributed to the rampant decline, as my colleague Dakin Campbell explained. In short, investors are worried about how rising interest rates will affect CoreWeave’s ability to raise debt, which it needs to fund its business of selling cloud computing services. They’re also concerned about whether CoreWeave can handle the costs of the mound of debt it already has. Last week, fresh data on U.S. inflation fueled interest rate concerns: Inflation jumped in September, increasing the odds that the Federal Reserve will hike interest rates—making all debt more expensive. Even though there was no new inflation data this week, CoreWeave shares continued to fall—from around $60 on Monday to roughly $54 on Friday. Not even Nvidia’s all-powerful CEO, Jensen Huang, was able to stanch the bleeding when he tried to sound a note of confidence for CoreWeave on Thursday, saying the demand for companies like CoreWeave—neoclouds—is “off the charts.” The stock nerds over at Barron’s tried to argue that Wednesday’s earnings report from SpaceX is actually a good sign for CoreWeave. Those numbers showed surging demand for SpaceX’s nascent business of selling its excess AI compute, but I’m not sure whether that necessarily bodes well for the company. Yes, an indicator of demand for compute could be interpreted as a welcome data point for CoreWeave, a compute seller. But SpaceX’s compute business increasingly seems like a real competitor to CoreWeave and other neoclouds, and as the much, much better established company, SpaceX has the resources to fund expansion of its compute-selling efforts without acquiring hazardous amounts of debt. And investors are a great deal less likely to sink its stock price over interest rate jitters. More news from Wednesday highlighted the industry’s appetite for compute. Meta Platforms said it will create a new share class in January—essentially a two-for-one stock split—that will allow it to reach for more capital to spend on AI. It’s also partly a maneuver that would help CEO Mark Zuckerberg pay off California’s billionaire tax if the levy is approved next month. Meta’s board justified helping Zuck pay his taxes by saying that the CEO had threatened to pick up sticks and leave California—and that it was essential to have him in the office as much as possible. (I had to laugh. Just a couple years ago, Zuckerberg was telling us the metaverse would arrive soon, and we’d all be living as digital stick things. Such was the potential of the metaverse that Zuckerberg renamed his entire company for it. Well, guess not!) More capital at Meta might be good for CoreWeave. Meta is a CoreWeave customer—to the tune of $35 billion. There’s no guarantee, of course, that Meta will take a newfound gusher of capital and go back to CoreWeave again. Recently, Meta has been building its own data centers and readying production of its custom AI chips. It has also considered selling compute. Investors looked on wearily at Meta’s stock split/potential Zuck gift, with the company’s shares dropping nearly 9% on Thursday. In fact, Meta’s moves unnerved the entire market yet again over how much this whole AI thing will cost. The Nasdaq sank 2.6% on Thursday. CoreWeave shares fell 10%, while declines also hit Nebius (down 7.2%) and IREN (8.3%), the two other publicly traded neoclouds. And everything kept falling on Friday. Are all the stock moves based on buttoned-up rationality? No. But like the common cold that I’m always certain will put me six feet under, worry on Wall Street is contagious.—Abram Brown (abe@theinformation.com) The Information’s Must-Read StoriesRamp Investors Went Nuclear Against Airwallex After Doomed DealHackers Used Claude and Grok to Automate Attacks on BanksHow CoreWeave’s Debt Binge Brought a Moment of Reckoning Listening: “Bear Brook: A Private Matter” Back in 2017, NHPR, a little public radio station in New Hampshire, found itself with a hit national podcast, “Bear Brook,” about cold-case murders—four bodies in two barrels stashed in Bear Brook State Park—and the genetic testing involved in investigating the crimes. Reporter Jason Moon followed up with a second season about a different crime in 2023 and now returns with a third season about another weird happening: the disappearance of 76-year-old Jay Hickey, a local Christmas tree farmer. (Moon likens the setting to a Hallmark movie—frankly, it gave me distinct “Twin Peaks” vibes.) After Hickey vanished one autumn, it was months before anyone went looking for him. That was strange because he was suffering from dementia, so surely his wife, Pat, would’ve, uh, noticed he wasn’t around, right? Obviously she offed him, right? Perhaps, but she clearly was suffering from something herself. It’s the type of tale that could be glossed over with schlock, sordid storytelling. That’s definitely not Moon’s approach.—Abram Brown Reading: “Kobuk the Destroyer” by Alex Davies Just in the past 12 hours, I’ve dodged a number of possible catastrophes: I was not singed by my hair dryer, crushed by my office’s elevator doors or left unproductive by a bunch of buttons tumbling out of my keyboard. I owe my good fortune to the rigorous science of product testing, a gorpy-seeming topic made into enlightening, witty entertainment in “Kobuk the Destroyer” by Alex Davies, a former Wired magazine editor. It is an ode to the nerd geniuses who devise those tests, but it can also feel like a drop directly onto the factory floor of Looney Tunes’ Acme Corporation, presenting a sharp critique of how often executives cut corners and ignore blatant problems as they pursue commercialization. Without the centurylong expansion of product testing, we’d all be left in the same position as Wile E. Coyote, with faulty, rocket-powered roller skates attached to our feet. The titular Kobuk, a grizzly bear, may be one of the most prolific practitioners of the field—having lived out the last several decades at a Montana wildlife sanctuary that partners with a government agency to certify various products as bear proof. Kobuk has the great joy of tearing apart coolers, trash cans, composters, and many other items, and gets rewarded with fish, peanut butter, honey, and dog biscuits for his efforts: Whatever survives Kobuk’s assault receives the certification. Through his efforts, the general public can buy coolers that actually do keep out other Kobuks. Theoretically, that prevents his shaggy-haired brethren from learning to filch food or hang around humans, habits that can get a bear relocated or euthanized. Kobuk has pawed his way onto a noble path initially blazed in the 1920s by Underwriters Laboratories, a Chicago-based business that pioneered the art of product testing—with engineers who assessed the durability of safes by subjecting them to thousand-degree heat, 30-foot drops and kerosene-fueled explosions. Davies keeps up a brisk pace as he winds through the many testing approaches adopted by various industries in the following years, including the NASA wind tunnel used to develop the Curiosity Mars lander and the oval-shaped gelatin sacks that engineers fired into airplane engines to avoid needing to kill thousands and thousands of live birds. As many of you might surely agree, determining the safety of one group of products in particular remains decidedly challenging: ahem, AI! Much of the alignment training and red teaming that goes into AI development comes away with vague conclusions, Davies writes: We simply don’t understand enough about what we’ve created, and AI often operates much more unpredictably than, say, a refrigerator door or an airbag. Trying to understand why an AI behaved safely in one setting but dangerously in another is “like trying to understand why your dog growls at people carrying shopping bags but not people carrying suitcases.”—A.B. Watching: “Carrie” Stephen King’s cabinet of terrors is a well-stocked place, cluttered with weird evils, many with complex, lengthy backstories. The It of “It,” you may recall, is not actually an evil clown—it’s an ageless, alien ball of light. “The Langoliers” is a time-travel story…about piranha-like, interdimensional critters that literally eat time. I could try to also get into the motivations of Randall Flagg in “The Stand,” but unlike King, I don’t have 823 pages to do that here. The knottier of King’s novels defy easy screen adaptations. Other retellings of King stories fail on the screen largely because they suffer in comparison to finer, earlier movie adaptations, to say nothing of their misappropriation of King’s material. On Amazon, there’s an excellent new restructuring of King’s “Carrie,” his first bestseller and, of course, the source for a much-loved film by director Brian De Palma, which put both De Palma and King on the map. There’s a simplicity and universal resonance to King’s story of tortured, telekinetic high schooler Carrie White that makes it highly moldable: Teenagers have been terrifying ever since there have been teenagers, both to themselves and to those around them. Amazon’s “Carrie” was helmed by Mike Flanagan, who has a string of spooky series on Netflix (“The Fall of the House of Usher,” “The Haunting of Hill House”) and did the 2019 movie adaptation of King’s “Doctor Sleep.” Flanagan adeptly positions his “Carrie” in the modern day. The infamous shower scene, for example, does not really end when Carrie (newcomer Summer Howell) is escorted away by kindhearted PE teacher Miss Desjardin (Amber Midthunder). Her bullying classmates captured the entire thing on their cellphones, and their torment of her continues via an anonymous Instagram account. Later, her mother, Margaret (Samantha Sloyan), a religious nut who also favors QAnon-like conspiracy theories, seizes the internet as a means for her own ferocious manipulations. With the benefit of an eight-episode run, Flanagan gets the opportunity to give greater depth to the Whites and the people around them, including Carrie’s chief bully, Christine (Alison Thornton), and classmate Sue (Siena Agudong), who befriends Carrie in this version. Granted, it might seem like Flanagan is trying to stretch the material as thin as a funeral crepe. He doesn’t, aided by roundly top-notch performances.—A.B.
document fetched 2026-10-24 15:21 · canonical https://theinformation.com/articles/neoclouds-gathering-storm