Anthropic Investor Day, CoreWeave Shares Sink, Media Stock Roundup 10/14/26

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Kelly Evans (1:08)

Welcome to Power Lunch, everybody. I'm Kelly Evans. Brian Sullivan is off today and Steve Liesman will join me shortly. Take a quick look at the markets under pressure this hour. As investors react to a hotter than expected inflation report, the Nasdaq 100 is leaving us lower, down about 2% of these session lows, and the tech trade is in the red. Broadly, it's the worst performing sector today. CoreWeave taking a hit as investors scrutinize the cost of financing the AI buildout. Yields on its bonds have climbed towards 15%, reviving questions about how much debt this infrastructure race can support. Seema Modi has new reporting on that and we'll talk to her in just a moment. Plus noted investor Bradley Tusk is here to help navigate the state of tech, artificial intelligence and more. And in media, Disney is trying to extend its winning streak. While Netflix is cutting about a thousand jobs, LightShed's Rich Greenfield joins us with his take on what comes next for the industry.

Let's start this hour with venture capitalist Bradley Tusk. He is the founder and CEO of Tusk Ventures. Bradley, it's great to have you on and kind of with these topical thoughts, everyone's saying, yeah, we're going from buy anything AI related, literally turn smart birds into all birds, into anything AI related to, wait a minute, we have this capital has to have a return. This comes by the way, as we're getting ready for some big IPOs, we can talk about that a little bit later on.

The market's message seems pretty clear here, does it not? So where does the value go next?

Bradley Tusk (2:33)

Yeah. I mean, look, you and I have talked about this a lot and ultimately, it's very easy to get excited about something, especially technology is transformational as AI. But at the end of the day, P has to be greater than L and you have to have revenue and you have to have EBITDA and even having fast growing revenue if it is dwarfed by your debt and your catbacks and everything else doesn't work at the end of the day. And so I think the market is finally starting to wake up to it. But that's after a lot of companies have already taken on a tremendous amount of debt. And that's why the yields are moving up so fast. And that makes it really hard for companies like CoreWeave because they've got $35 billion that they need to do in catbacks.

That's really tough. And then layer on top of that, beyond interest rates and inflation going up again and everything else, for CoreWeave especially, data center construction is taking a really long time because there is so much political opposition to it. And any project that you are underwriting, if speed to market declines materially because you can't get through the regulatory process, that makes everything even more expensive.

Kelly Evans (3:41)

Right. And debt is expensive, the equity is falling. You think, oh, it's panic time, except if you looked at the Dow, which until a couple of hours ago was green on the day.

In other words, Bradley, this is kind of a narrow and specific problem in some ways. I don't know if we should think that it's going to spread. I mean, sure whoever's financing, like the next financing layer seems vulnerable. That's what Chamath was talking about, watch private credit and so forth. But right now, you can be in a lot of other companies, in a lot of other sectors and industries and just point to this and say, hey, these look like a couple of names that got overextended.

Bradley Tusk (4:19)

Yeah, you can say that and that might be true. But at the same time, fundamentally, the way that I look at it on the early stage venture side and the way that I would look at if I were a retail investor in the market is, what are the companies that have the ability to reach the market and generate significant revenue that could exceed the cost of generating that revenue? I know this is Economics 101, but still at the end of the day, a lot of our investments, for example, are in applications of AI, as opposed to the underlying frontier models, simply because if you can charge money for a service that they can't get otherwise, and you're not responsible for building data centers and buying GPUs and everything else, that's a much better business. Or for us, for example, we've been investing in startups that can do alternate forms of compute that can make the energy, needs for data sensors a lot lower and make the compute a lot more efficient, which really makes both the political process better, and then ultimately the cost of operating the data center better.