Skydance (SKYD) shares are seemingly crashing on Wednesday morning, but this headline decline needs careful interpretation.

The sell-off largely reflects the separation of shareholder warrants from the firm’s common stock, rather than an equivalent collapse in the value of investors’ combined holdings.

With those warrants trading around $2.33, eligible shareholders now own “two” separately priced securities.

For prospective buyers of SKYD stock, a more important question is whether the lower share price offers value after accounting for that separation.

Warrant distribution is dragging Skydance stock lower

October 14 marks the ex-distribution date for Skydance’s warrants, which means shares now trade without the entitlement attached.

This adjustment is the principal explanation for today’s massive decline in Skydance stock.

SKYD distributed about 470.7 million warrants on Tuesday – with eligible investors receiving one for each qualifying Class B share.

Each initially allows its holder to purchase one share for $12 and is scheduled to expire on October 13, 2036, subject to provisions permitting earlier expiration.

The distinction matters: an eligible investor’s position now comprises both stock and warrants.

Looking only at the common shares therefore gives an “incomplete picture” of today’s economic impact.

The value has been divided between two instruments, making the price chart more alarming than the combined holding necessarily warrants.

Are SKYD shares available to buy at a discount today?

Using the reported morning prices, one Skydance share plus one warrant was worth about $9.20.

That calculation illustrates why a 26% decline in the stock alone cannot be treated as an equivalent loss for an eligible holder who retained both securities. These are intraday snapshots, however, and both prices can change.

For someone buying today, the analysis is different.

Buying shares after the entitlement separates does not secure the distributed warrant, so comparing today’s stock price directly with yesterday’s bundled position creates a misleading impression of a bargain.

A credible buying case must rest on future earnings, cash generation, and valuation.

The percentage drop alone offers little evidence of undervaluation.

Investors considering an entry should first establish what they’re buying and whether its standalone price adequately compensates them for the business risks.

What will determine Skydance’s broader trajectory?

Beyond today’s trading mechanics, SKYD shares face a “demanding” financial agenda. Following its combination with Warner Bros. Discovery, the company has about $78.9 billion in net debt.

Management is targeting synergies worth roughly $6 billion within three years and over $10 billion in annual free cash flow by the end of this decade.

So the investment case depends on converting operational improvements into cash while managing borrowing costs and integration spending.

Cutting duplicated expenses could improve profitability, but investors also need evidence that the combined business can sustain revenue and protect its content offerings.

Upcoming financial updates will therefore carry more weight than today’s dramatic chart.

Progress on cash flow, debt reduction, and integration will determine whether Skydance’s lower share price becomes an attractive entry point or reflects a turnaround still awaiting proof.

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Bending Spoons shares (BSP) surged on Wednesday after Berkshire Hathaway invested another $330 million in the Italian technology company, bringing its total investment to $930 million and increasing its stake to approximately 4%.

The stock climbed 42% during Wednesday’s trading.

The rally followed news that Berkshire, the conglomerate formerly led by Warren Buffett and now headed by CEO Greg Abel, had purchased additional shares in the company, which acquires and transforms digital businesses.

Bending Spoons will issue 10 million ordinary shares to Berkshire at $33 apiece through a private placement.

The price represents a discount to Tuesday’s closing price of $37.86, even as the stock rallied sharply following the announcement.

The investment makes Berkshire the Italian company’s sixth-largest investor, according to LSEG data.

Bending Spoons said the funds would strengthen its financial flexibility and support its acquisition strategy.

Berkshire’s investment boosts Bending Spoons stock

Berkshire invested $600 million in Bending Spoons’ initial public offering in July before committing an additional $330 million.

The latest purchase brings its total investment to $930 million.

The market reaction suggests investors view Berkshire’s participation as an endorsement of Bending Spoons’ strategy of acquiring digital businesses and seeking to improve their performance.

The company has assembled a portfolio that includes AOL, Vimeo, Evernote, Brightcove, Eventbrite, productivity software maker Airtable, pet-tracking company Tractive and file-sharing platform WeTransfer.

In September, Bending Spoons also agreed to acquire Miro in a $1.4 billion deal.

The company continues to evaluate merger and acquisition opportunities and has a strong pipeline, according to Francesco Patarnello, its co-founder and head of business acquisitions.

Bending Spoons said the latest investment would provide additional financial flexibility as it pursues further acquisitions.

Valuation raises questions despite the rally

Despite Wednesday’s surge, Bending Spoons trades at a substantial valuation relative to its projected financial performance.

The company has a market value of around $40 billion, based on the share count implied by its announcement, and had approximately $4 billion in debt at the time of its IPO, according to Barron’s.

The stock trades at nearly 10 times forward sales based on enterprise value, which includes market capitalisation and debt. It also trades at around 30 times projected 2027 earnings.

Berkshire’s investment could generate a substantial paper gain following Wednesday’s rally.

Barron’s estimated that the conglomerate was sitting on a profit of approximately $600 million after the stock’s rise.

The $33 placement price also means investors buying after the rally are paying considerably more than Berkshire paid for its latest shares.

Berkshire expands technology exposure under Greg Abel

The investment comes as Berkshire has increased its exposure to technology companies under Abel, who took over as chief executive at the start of the year.

The conglomerate has also built a significant position in Alphabet, Google’s parent company, which became its third-largest common stock holding. Berkshire’s largest stock investments include Apple.

The shift towards technology marks a notable development for a company long associated with Buffett’s value-investing philosophy.

Berkshire has historically favoured businesses trading at attractive valuations, including Japanese trading companies and homebuilder Lennar.

Bending Spoons’ valuation contrasts with some of those traditional investments.

Its shares trade at nearly 10 times forward sales, while Berkshire’s previous investments have often focused on lower earnings multiples or businesses trading below book value.

The latest purchase may therefore raise questions about how Berkshire is balancing its traditional investment approach with opportunities in technology.

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US financial markets faced renewed pressure on Wednesday as hotter-than-expected underlying inflation reinforced expectations of further Federal Reserve rate increases.

Rising energy prices added to inflation concerns, while Treasury yields and the US dollar climbed, weighing on gold and Bitcoin.

Geopolitical tensions involving Iran, Saudi Arabia and shipping routes in the Middle East also pushed oil prices higher.

US CPI rises 3.7% annually, lifting Fed rate hike expectations

US consumer inflation accelerated in September, with the consumer price index (CPI) rising 0.6% month-on-month and 3.7% year-on-year, according to the Bureau of Labor Statistics.

The annual rate increased from 3.4% in August, while the monthly reading matched economists’ expectations.

Core CPI, which excludes food and energy, rose 0.3% during the month and 2.6% over the year, exceeding forecasts of 0.2% and 2.5%, respectively.

Higher gasoline prices were the primary driver of the monthly increase.

The gasoline index jumped 9.1%, accounting for more than half of the overall CPI rise.

The broader energy index advanced 5.2%, while shelter costs increased 0.4%. Food prices were unchanged.

The data strengthened expectations that the Federal Reserve could raise interest rates again.

Markets increased the probability of an October rate hike to around 42%–43%, from approximately 22% before the report. Expectations for another increase in December also strengthened.

The Fed raised its benchmark rate by 25 basis points in September to a range of 3.75% to 4.00%.

However, policymakers must weigh persistent inflation against signs of weakness in the labour market before deciding on further tightening.

Oil prices rise as Middle East tensions threaten supplies

Oil prices climbed on Wednesday as attacks involving Saudi Arabia and Iran raised concerns about energy supplies and shipping through the Strait of Hormuz.

Brent crude futures rose 0.32% to $106.03 a barrel, while US West Texas Intermediate crude gained 1% to $95.08, reaching a three-week high.

The Houthi movement attacked an administrative building belonging to Saudi Aramco in Dhahran, causing a limited fire, according to Saudi Arabia’s energy ministry.

Meanwhile, Iran indicated it was deploying new tactics to target shipping, while a container ship sank after hitting a naval mine and catching fire in waters south of the Strait of Hormuz.

The developments added to concerns about disruptions along a critical route for global energy shipments.

Although Gulf oil flows excluding Iran recovered to more than 81% of prewar levels in September, the improvement did not necessarily indicate an equivalent increase in production.

Some of the recovery reflected the redistribution of available crude supplies.

The International Energy Agency also warned that limited Russian refinery capacity could restrict the impact of recently eased Russian diesel export restrictions, potentially keeping diesel supplies tight into next year.

Gold falls as dollar and Treasury yields climb

Gold prices declined for a third consecutive session as the stronger inflation report increased expectations of further US interest rate increases.

Spot gold fell 1.3% to $4,100 an ounce. US gold futures for December delivery settled 1.26% lower at $4,124.80 an ounce.

The US dollar index rose 0.5%, while the 10-year Treasury yield climbed more than six basis points to 5.278%. Higher yields increase the opportunity cost of holding gold, which does not generate interest income.

The prospect of tighter monetary policy added to the pressure on bullion, despite its traditional role as an inflation hedge.

Longer-term support could come from continued central-bank purchases and concerns about US government debt.

Bitcoin falls as risk appetite weakens

Bitcoin declined as much as 1.7%, trading around $81,700 as investors reduced exposure to riskier assets following the inflation data.

The move coincided with a broader market retreat.

The Nasdaq 100 fell as much as 2%, while the dollar strengthened to its highest level since May 2025 as traders increased bets on further Federal Reserve rate hikes.

Despite the decline, sentiment among crypto analysts has improved.

A CryptoQuant report showed its 30-day Bitcoin analyst consensus index rising from minus 18.3 in July to plus 49.2, with the share of bullish analysts increasing to 84% from 37%.

However, Bitcoin remains more than 30% below its record high, and attempts to sustain a recovery have repeatedly struggled.

Elevated inflation, high energy prices, and concerns about AI-related investments continue to weigh on broader risk appetite.

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CoreWeave shares CRWV and bonds came under heavy pressure on Wednesday as investors grew increasingly concerned about the scale of borrowing by technology companies to finance the artificial intelligence infrastructure build-out.

Shares of the AI-focused cloud computing provider plunged 16%, while yields on its outstanding debt surged, reflecting a growing demand for compensation for the risks associated with financing the sector.

The yield to maturity on CoreWeave’s 9.625% bond due in 2032 reached 14.8%, while the yield on its 9.75% bond due in 2031 stood at around 14.9%.

Bond yields move inversely to prices, meaning the increase reflects a sharp decline in the market value of the securities.

The sell-off highlights a shift in investor sentiment towards companies that have borrowed heavily to build data centres and expand computing capacity to meet demand from AI developers.

While investors were previously eager to gain exposure to the AI boom, concerns about borrowing costs, future revenues and the ability to generate adequate returns are increasingly influencing investment decisions.

“The era of easy money, which we experienced in the first nine months of the year, is starting to disappear and dissipate,” said Luis Alvarado, co-head of global fixed income strategy at Wells Fargo Investment Institute.

“Now the extra dollar or the marginal dollar is going to be more looked at with a microscope into the concessions that the issuer is giving you back.”

CoreWeave debt draws attention from prominent investors

The sharp increase in CoreWeave’s borrowing costs also attracted attention from prominent technology investors.

Chamath Palihapitiya, founder and chief executive of Social Capital and chief executive of AI company 8090, highlighted the rising yield on CoreWeave’s 2032 bond in a post on X late Tuesday.

He shared a chart showing that the yield had “touched 15%” before it “closed at a new high”.

Palihapitiya also referred to his analysis of whether the AI infrastructure boom was creating a private credit bubble, highlighting “how little extra lenders appear to charge for AI risk.”

Tesla and SpaceX chief executive Elon Musk responded to the post with a brief assessment: “yikes.”

Heavy borrowing and data centre expansion weigh on outlook

CoreWeave’s balance sheet is “relatively bad” compared with those of its neocloud peers, according to Paul Meeks, head of technology research at Freedom Capital Markets, CNBC reported.

Meeks attributed the difference to CoreWeave’s heavier borrowing and its ongoing construction of additional data centres.

“The yields have blown out because there’s just more and more concern — that I don’t share — about the wherewithal of these guys [being] able to over time pay back their interest expense,” he said.

“It’s definitely not a deteriorating situation,” he added.

“Maybe it’s not improving, and I didn’t really expect it to improve until these data centers get up and running.”

Meeks expects CoreWeave to report flat margins between June and September, followed by a potentially significant improvement between September and December.

The company’s next quarterly results are expected in November.

CoreWeave has raised more than $35 billion this year through chip-backed loans, high-yield bonds, convertible bonds and share sales.

Its debt and lease obligations totalled approximately $52 billion at the end of June, underscoring the scale of its financing commitments.

Chief executive Michael Intrator defended the company’s financial position in an internal memo to employees, viewed by Bloomberg, arguing that the stock’s decline reflected irrational market behaviour.

“When you are building a new type of technology company, there will be periods of time when the market misunderstands and acts irrationally,” he said, according to the report.

“We are confident in our business model, our customers, the extraordinary quality of our execution, and the relentless discipline around the financial engine we have built.”

Gartner warns of pressure on neocloud business models

The pressure on CoreWeave comes also as research and advisory firm Gartner warns that the AI industry’s spending ambitions could prove difficult to justify through revenue generation.

AI providers are on track to invest nearly $1 trillion in hardware and facilities in 2026, followed by another $6 trillion through 2030, Gartner estimates.

However, the firm projects that total AI-attributable revenue during this period will reach only around $3.6 trillion.

“Enterprise and consumer AI revenue will be insufficient to support profitable returns on all planned AI capital expenditures during this period,” said Will Sommer, senior director analyst at Gartner.

The widening gap between projected investment and potential revenue could put considerable pressure on companies providing specialised cloud computing infrastructure.

“By 2030, Gartner predicts that cost pressure and a lack of a differentiating business model will force over 80% of neocloud providers to cease independent operations.”

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US stocks closed lower on Wednesday as hotter-than-expected inflation data increased expectations of further Federal Reserve interest rate hikes, weighing on technology shares and other rate-sensitive investments.

The S&P 500 fell 1.08% to 7,721.49, while the Nasdaq Composite dropped 1.85% to 26,701.48.

The Dow Jones Industrial Average declined 0.09%, or 45.23 points, to 51,624.87, with gains in healthcare stocks helping limit its losses.

Investors also assessed quarterly results from major US banks, while concerns about rising borrowing costs and debt-financed artificial intelligence infrastructure spending added pressure to the technology sector.

Hotter US CPI data raises Fed rate hike expectations

The US consumer price index rose 0.6% month-on-month in September, while annual inflation accelerated to 3.7%, above economists’ expectations of 3.6%.

Core CPI, which excludes food and energy, increased 0.3% during the month and 2.6% over the year. Both readings exceeded forecasts of 0.2% and 2.5%, respectively.

Rising gasoline prices accounted for more than half of the monthly increase in headline inflation, while price pressures also broadened beyond energy.

The data increased concerns that the Federal Reserve may need to maintain tighter monetary policy for longer or raise interest rates again.

According to CME’s FedWatch tool, traders priced in a 32.7% probability of an October rate hike, up from 22% on Tuesday.

The prospect of higher borrowing costs weighed on equities, particularly companies whose valuations depend on future growth and continued access to financing.

Despite Wednesday’s decline, the S&P 500 remained more than 12% higher in 2026 after reaching a record high the previous week.

However, the median stock in the index had gained just 4% for the year, while more than 200 components were in negative territory.

AI stocks and chipmakers extend their losses

Technology shares led the market decline as investors reassessed the outlook for artificial intelligence investments amid rising interest rate expectations and concerns about debt-funded infrastructure expansion.

Oracle shares fell around 9%, while CoreWeave plunged more than 16%. Nebius also declined as investors reduced exposure to AI infrastructure companies sensitive to higher borrowing costs.

Chipmakers extended their recent losses. Advanced Micro Devices fell 5%, while Intel and SanDisk each declined 4%. Micron Technology dropped 3%.

The Philadelphia Semiconductor Index fell for a sixth consecutive session, marking its longest losing streak since May 2025.

Dell and Hewlett Packard Enterprise also declined after Barclays downgraded both AI server manufacturers to Equal Weight from Overweight.

The sell-off highlighted growing investor scrutiny of the financing required to support AI infrastructure expansion, particularly among companies outside the largest technology firms.

Bank stocks fall as BofA and Morgan Stanley decline

Financial stocks also weighed on the market following quarterly earnings announcements from major US lenders.

Bank of America shares dropped 5% after its third-quarter revenue missed expectations. The bank’s profit was also hurt by provisions for more than $1.2 billion in regulatory penalties linked to failures in detecting potentially suspicious transactions.

Morgan Stanley shares fell nearly 4% despite reporting quarterly results that exceeded expectations, supported by stronger equity trading performance.

The S&P 500 Banks Index declined to its lowest level in more than four months, reflecting pressure across the sector.

Elsewhere, Bending Spoons shares rallied after Berkshire Hathaway invested another $330 million in the Italian technology company, adding to its previous $600 million investment.

The move brought Berkshire’s total investment to $930 million and its stake to approximately 4%.

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