Investors betting against US artificial intelligence infrastructure companies have recorded about $6 billion in paper profits in October as concerns over rising debt and the sustainability of AI spending trigger a sell-off in data centre stocks.
The gains came as shares in companies supplying computing infrastructure for AI development declined, reflecting growing investor concerns about the cost of financing the industry’s rapid expansion.
Data analytics firm ORTEX reported that short interest in five companies, CoreWeave, IREN, Nebius Group, Applied Digital and Core Scientific, ranged from approximately 20 per cent to 26 per cent of their available shares.
CoreWeave recorded short interest of 23.7 per cent of its free float, up from 19.6 per cent at the beginning of October. Investors betting against the company accumulated nearly $1.7 billion in paper profits this month after its shares fell almost 30 per cent.
Short sellers targeting Nebius Group recorded $2.94 billion in paper profits during October, although their positions remained down $3.33 billion for the year to date.
Meanwhile, investors betting against IREN and Applied Digital generated combined paper profits exceeding $1.2 billion. Short sellers of Core Scientific made approximately $115 million over the same period.
Across the five companies, around $17 billion worth of shares had been sold short, according to ORTEX.
The developments highlight growing investor caution over debt-funded AI infrastructure expansion, as companies invest heavily in computing capacity to meet rising demand.
However, the reported gains are unrealised paper profits and could change as share prices fluctuate.
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