The Biggest Risk to Your Portfolio Isn't Missing AI -- It's Holding These 2 Stocks When the Hype Fades
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By Johnny Rice – Dec 12, 2025 at 2:30PM ESTKey PointsCoreWeave now pays roughly six times its gross profit just to service interest on its ever-growing debt load. Oracle's credit risk has reached levels not seen since 2008, as the company floods bond markets to fund data centers for OpenAI.These 10 Stocks Could Mint the Next Wave of Millionaires ›NYSE: ORCLOracleMarket Cap$567BToday's Changeangle-down(-4.51%) $8.97Current Price$189.88Price as of December 12, 2025 at 3:14 PM ETIf the AI boom slows, these leveraged bets could unravel fast.The hype surrounding artificial intelligence (AI) has reached a fever pitch. While it's possible that the technology will live up to its promise, I think that enthusiasm has outpaced fundamentals. If that's true and the hype fades, here are two stocks that I would not want in my portfolio. Image source: Getty Images. 1. CoreWeave is highly leveraged CoreWeave's (CRWV 8.38%) central role in the AI data center buildout makes it a favorite among those betting that the spending spree will continue. While the "neocloud" operator is on track this year to nearly triple its revenue from 2024, the uncomfortable truth is that this growth is being fueled by enormous amounts of debt. ExpandNASDAQ: CRWVCoreWeaveToday's Change(-8.38%) $-7.32Current Price$80.06Key Data PointsMarket Cap$44BDay's Range$77.66 - $87.7052wk Range$33.52 - $187.00Volume29MAvg Vol30MGross Margin49.23% The company's model requires it to scale at lightning speed, far quicker than it could with its own cash. CoreWeave's capital expenditures (capex) have far exceeded not just its cash from operations, but its entire revenue for each quarter on record. Over the last 12 months, the company's capex was more than double its sales and 6 times its operating cash flow. This has led to a balance sheet with more than $10 billion in long-term debt, and this is not cheap debt. CoreWeave is forced to borrow at high interest rates, and it now pays 6 times its gross profit just to service its debt.Advertisement The company has an agreement with Nvidia that guarantees it up to $6.3 billion if demand cools enough that CoreWeave has more supply than it can sell. But despite that seemingly massive figure, it's nowhere near enough if the hype fades considerably. 2. Oracle's reliance on OpenAI is not an asset Much like CoreWeave, Oracle (ORCL 4.51%) is relying on leverage to fund its growth, making it especially risky if the market goes belly up. As a mature company with a substantial business prior to the AI boom, Oracle's numbers aren't quite as dramatic as CoreWeave's, but it's close. The company's all-in AI strategy means that it is expending enormous resources to meet the demands of its AI customers, namely OpenAI, and growing its credit obligations. ExpandNYSE: ORCLOracleToday's Change(-4.51%) $-8.97Current Price$189.88Key Data PointsMarket Cap$567BDay's Range$185.99 - $197.8552wk Range$118.86 - $345.72Volume2.2MAvg Vol26MGross Margin74.29%Dividend Yield0.96% Oracle has flooded debt markets with tens of billions of dollars worth of bonds this year, with the rate of issuance rapidly increasing in recent months. Oracle's credit default swaps -- essentially insurance policies against the company failing to pay its debts and a gauge for how risky the market believes its debt to be -- have reached their highest point since the 2007-08 great financial crisis. That is, in large part, because of the company's reliance on one customer. Oracle's massive debt raise is funding the construction of data centers intended to primarily serve OpenAI, which is on the hook to pay Oracle at least $300 billion over the next five years. This is just one of OpenAI's many commitments that I am unsure how it will fulfill, even if the AI spree continues. OpenAI's total annual sales are only in the low double-digit billions. And that is its top line; the company is losing money hand over fist, according to the limited financial information available from the private company. If the hype fades, Oracle could find itself having taken on massive amounts of expensive debt with little to show for it. Oracle and CoreWeave are risky bets Even the most confident bulls can't deny that the scale of spending is, more or less, unprecedented, and that AI hype today feels a lot like dot-com hype in the 1990s. If the hype fades, just like in past extreme hype cycles, there will be companies that continue to thrive in the aftermath. They won't include CoreWeave or Oracle. Both companies are "betting the farm," so to speak, rapidly accumulating expensive debt under the assumption that AI demand will not only continue, but accelerate. If AI adoption slows and the hype fades, these are not the stocks you want to own.About the AuthorJohnny Rice is a contributing writer for The Motley Fool covering tech stocks. He previously contributed to various financial publications.TMFJohnnyRiceRead NextDec 12, 2025 •By Johnny RiceWhy Oracle Stock Plunged More Than 12% This WeekDec 12, 2025 •By Bram BerkowitzWhy Shares of Oracle Are Sinking TodayDec 12, 2025 •By Daniel FoelberEven Though Oracle Fell After Earnings, I'd Still Rather Buy It in December Over Every "Magnificent Seven" Stock (Except One)Dec 12, 2025 •By Timothy GreenOracle Stock Just Tumbled: Here's One Reason WhyDec 12, 2025 •By Jose NajarroWhy Oracle Stock Dropped After the Company Reported a Massive Increase in RPODec 11, 2025 •By Timothy GreenOracle's Debt Balloons to $108 Billion as AI Spending Soars