India, Oct. 26 -- Shares of several neocloud companies fell on Monday after SpaceX CEO Elon Musk warned that the sector could face significant consolidation and failures, adding to investor concerns over heavy artificial intelligence infrastructure spending and weak profitability.
CoreWeave shares declined 1.6 percent, while Nebius Group fell 4 percent, IREN lost 1.5 percent and Applied Digital dropped 2 percent. Musk said more than 200 neocloud companies could face consolidation, with only a small number likely to survive.
The warning comes as AI infrastructure providers take on substantial debt to finance data centers and computing capacity. Gartner has estimated that 80 percent of neocloud companies could cease operating independently ...