The expected postponement of Nvidia Corp.-backed data center company Firmus Grid Ltd.’s Australian IPO is an ominous sign for other proposed listings, coming after a string of disappointing debuts for artificial intelligence infrastructure firms.

Firmus’ looming decision to pause its IPO of as much as $5.5 billion and instead consider raising more money privately came after some investors flagged the pricing strategy for the deal as aggressive, Bloomberg News reported.

A sharp rise in US Treasury 10-year bond yields in the past month hasn’t helped the rate-sensitive group. The so-called neoclouds that investors are comparing many of these companies to, such as CoreWeave Inc. and Nebius Group NV, are among the most leveraged and volatile AI stocks, said Dave Mazza, chief executive officer of Roundhill Investments.

“The bear case is having a moment, because the cost of capital has become unhinged and equities with long duration are taking a hit, so the set up in the short term is challenging,” said Mazza.

Several companies have already dragged their feet after publicly filing their paperwork with the US Securities and Exchange Commission, which requires that companies wait 15 days before kicking off formal IPO marketing. Though AI cloud computing provider Nscale Ltd. and SoftBank Group Corp.-backed AI data center and power infrastructure developer SB Energy Inc. filed for US listings last month, they have yet to start marketing their respective deals.

Singapore-based DayOne Data Centers Ltd. filed publicly for a US IPO earlier this week, and can begin formally pitching to investors on Oct. 21 based on the calendar.

All are looking to find an opening while investors await the potential mega-listing of frontier AI lab Anthropic PBC as early as November, people familiar with the matter have said.

“The thesis behind why we like these names is they are able to turn on compute more rapidly than the traditional cloud service providers, but these companies are trading at very high multiples to sales and they need to raise debt to fund their businesses,” said Mazza, whose active ETFs include the Roundhill Neocloud ETF.

“If you are Nscale and you see Firmus, it is not a confidence-building sign to price your IPO,” he said. A representative for Nscale declined to comment.

The Roundhill Neocloud ETF, whose holdings include Nebius, Coreweave and IREN Ltd., fell 7.2% on Thursday.

Companies looking to capture the surge of AI-related spending, or participate in it, have produced the pair of megadeals that have pushed the weighted average return for US IPOs this year to 15%, according to data compiled by Bloomberg that excludes blank-check firms and other financial vehicles.

Shares of SpaceX, whose record-setting $86.2 billion listing was pitched with a heavy emphasis on its future AI-related business, are up 19% since the IPO, and South Korean memory chipmaker SK Hynix Inc.’s American depositary shares are up 14% since the listing.

Data center firms Csquare Inc. and Blackstone Digital Infrastructure Trust Inc., by contrast, have fallen more than 15% each following their recent debuts.

Several so-called pick and shovels companies, which offer exposure to activity in AI-adjacent sectors such as the heating, cooling and ventilation systems in data centers or the power equipment used to keep them running, have also performed poorly after going public this year.

Still, Bloomberg Intelligence predicts spending on generative AI will reach $2.3 trillion by 2032, including about $286 billion on AI agent deployments alone. With the increase in AI usage that implies, many investors still see demand for computing power from data centers continuing to grow.

“There’s definitely a lot of equity and debt being raised out there but we believe that’s worth doing,” said Tim Ghriskey, senior portfolio strategist at Ingalls & Snyder.

“We believe there’s a huge amount of pent-up demand for data centers and I don’t think that’s going to stop. It’s not all going to be smooth sailing but there is a lot of growth ahead.”