CoreWeave's Stock Soars Amid AI Infrastructure Boom and OpenAI Partnership

CoreWeave (CRWV) Stock Pulls Back From All-Time High: What's Going On? - CoreWeave (NASDAQ:CRWV)

CoreWeave Inc CRWV shares are trading sharply lower Thursday despite a lack of company-specific news. Here's what investors need to know. What To Know: This week's surge in CoreWeave shares was fueled by a major infrastructure deal announced Monday with Applied Digital Corp. The companies signed two 15-year lease agreements granting CoreWeave access to 250 megawatts (MW) of critical IT capacity at a North Dakota data center. The agreement includes an option to expand by an additional 150 MW, potentially reaching 400 MW. Applied Digital expects approximately $7 billion in revenue from the deal. Read Also: Nvidia-Backed CoreWeave Reports Q1 Earnings Investor excitement around the partnership, combined with rising demand for AI computing and Nvidia Corp's recent strong earnings, as Nvidia is a key CoreWeave supplier, helped drive recent gains. However, Thursday's pullback appears to be driven by profit-taking amid the stock's recent, strong run. Despite Thursday's dip, CoreWeave remains at the center of the AI infrastructure boom, and investor sentiment in the sector remains strong as demand for high-performance computing continues to surge. Price Action: CRWV is down 9.2% to $148.10 on Thursday, pulling back after a meteoric rise that saw the AI infrastructure company soar over 180% in the past month. Despite the sharp decline, the stock remains up roughly 32% over the past week and has hit multiple all-time highs this week. Read Also: Silver Hits 12-Year High: Peter Schiff Says Rally's Just Starting How To Buy CRWV Stock By now you're likely curious about how to participate in the market for CoreWeave - be it to purchase shares, or even attempt to bet against the company. Buying shares is typically done through a brokerage account. You can find a list of possible trading platforms here. Many will allow you to buy "fractional shares," which allows you to own portions of stock without buying an entire share. In the case of CoreWeave, which is trading at $145.2 as of publishing time, $100 would buy you 0.69 shares of stock. If you're looking to bet against a company, the process is more complex. You'll need access to an options trading platform, or a broker who will allow you to "go short" a share of stock by lending you the shares to sell. The process of shorting a stock can be found at this resource. Otherwise, if your broker allows you to trade options, you can either buy a put option, or sell a call option at a strike price above where shares are currently trading - either way it allows you to profit off of the share price decline. According to data from Benzinga Pro, CRWV has a 52-week high of $166.63 and a 52-week low of $33.52. Image: Shutterstock CRWVCoreWeave Inc $149.60-8.28% Stock Score Locked: Want to See it? Benzinga Rankings give you vital metrics on any stock - anytime. Reveal Full Score Edge Rankings Momentum Not Available Growth Not Available Quality Not Available Value 9.17 Price Trend Short Medium Long Overview APLDApplied Digital Corp $14.197.08% Market News and Data brought to you by Benzinga APIs

CoreWeave Stock Is Rising After Hours: What's Driving The Action? - CoreWeave (NASDAQ:CRWV)

CoreWeave Inc CRWV shares are climbing in extended trading Wednesday following a report that the company is set to benefit from Alphabet Inc's GOOGGOOGL deal with OpenAI. What To Know: CoreWeave is set to provide computing capacity to Google's cloud unit, which Alphabet will sell to OpenAI as part of a recent deal between the two companies, Reuters reported on Wednesday. Sources familiar with the matter reportedly said the arrangement is aimed at meeting rising demand for AI services such as ChatGPT. Google is also expected to provide some of its own computing resources to the Sam Altman-led company. CoreWeave already has a $11.9 billion contract with OpenAI to provide computing capacity over five years. The company said in a regulatory filing last month that OpenAI committed to pay the company up to an additional $4 billion through April 2029 related to the agreement. CoreWeave made its public debut in March in an IPO at $40 per share. Despite stumbling out of the gates, shares have soared in recent months as the rise of generative AI and large language models continues to fuel incredible demand for high-performance computing infrastructure. CoreWeave reported 420% revenue growth in the first quarter and ended the period with a revenue backlog of $25.9 billion. CRWV Price Action: CoreWeave shares were up 3.21% in after-hours, trading at $154.51 at the time of publication on Wednesday, according to Benzinga Pro. Read Next: Oracle Q4 Earnings: Revenue, EPS Beat Estimates, Cloud Infrastructure Growth Expected To Accelerate With Demand 'Skyrocketing' Saudi Arabia Taps AMD, Cisco For Cloud Project: Report Photo: PJ McDonnell/Shutterstock. CRWVCoreWeave Inc$154.81-0.06%Stock Score Locked: Edge Members Only Benzinga Rankings give you vital metrics on any stock - anytime. Unlock RankingsEdge RankingsMomentumNot AvailableGrowthNot AvailableQualityNot AvailableValue9.52Price TrendShortMediumLongOverviewGOOGAlphabet Inc$178.50-0.84%GOOGLAlphabet Inc$177.30-0.73%Market News and Data brought to you by Benzinga APIs

CoreWeave Stock (CRWV) Calms After Massive AI Rally: What's Going On? - CoreWeave (NASDAQ:CRWV)

Shares of artificial intelligence infrastructure provider CoreWeave Inc CRWV saw a pullback Thursday morning. The dip represents a consolidation period for the stock, which has been on a meteoric rise, gaining over 151% in the past month alone amid a frenzy of AI-related investor excitement. What To Know: The stock's recent momentum was bolstered by news from Wednesday's extended session, where reports surfaced that CoreWeave is set to provide crucial computing capacity for a new deal between Alphabet's Google and OpenAI. This development adds to a string of positive catalysts that have propelled the company since its March IPO. Investors have been energized by CoreWeave's explosive growth, highlighted by a reported 420% year-over-year revenue increase in its first quarter and a massive $25.9 billion revenue backlog. The company's close partnership with GPU maker Nvidia Corp and its strategic agreements with AI pioneers have solidified its position as a key player in the high-performance computing space. Price Action: Data from Benzinga Pro shows Thursday's trading for CoreWeave has been volatile, with a daily range between $142.50 and $154.80. Read Also: Planet Labs Stock Is Trending Thursday: What's Going On? How To Buy CRWV Stock By now you're likely curious about how to participate in the market for CoreWeave - be it to purchase shares, or even attempt to bet against the company. Buying shares is typically done through a brokerage account. You can find a list of possible trading platforms here. Many will allow you to buy "fractional shares," which allows you to own portions of stock without buying an entire share. In the case of CoreWeave, which is trading at $149.76 as of publishing time, $100 would buy you 0.67 shares of stock. If you're looking to bet against a company, the process is more complex. You'll need access to an options trading platform, or a broker who will allow you to "go short" a share of stock by lending you the shares to sell. The process of shorting a stock can be found at this resource. Otherwise, if your broker allows you to trade options, you can either buy a put option, or sell a call option at a strike price above where shares are currently trading - either way it allows you to profit off of the share price decline. According to data from Benzinga Pro, CRWV has a 52-week high of $166.60 and a 52-week low of $33.52. Image: Shutterstock CRWVCoreWeave Inc$149.750.04%Stock Score Locked: Edge Members Only Benzinga Rankings give you vital metrics on any stock - anytime. Unlock RankingsEdge RankingsMomentumNot AvailableGrowthNot AvailableQualityNot AvailableValue9.52Price TrendShortMediumLongOverviewMarket News and Data brought to you by Benzinga APIs

Move Over Nvidia, Taiwan Semiconductor, and Micron. Brad Gerstner's Altimeter Capital Just Gave Investors 2,999,536 Reasons to Check Out the Hottest Artificial Intelligence (AI) IPO Stock of 2025 | The Motley Fool

Brad Gerstner's Altimeter Capital holds 2,999,536 shares of this year's hottest AI IPO stock. Brad Gerstner is the founder and CEO of hedge fund Altimeter Capital. Some of his more notable wins include being an early investor in data cloud company Snowflake and Asian ridehailing leader Grab. As is the case with many investment funds, Altimeter has made artificial intelligence (AI) stocks a core feature of its portfolio in recent years. According to its most recent 13F filing, Altimeter trimmed its stake in Nvidia during the first quarter while completely dumping its stakes in Micron and Taiwan Semiconductor Manufacturing. Interestingly, though, I discovered that Altimeter holds a position in red-hot AI IPO stock CoreWeave (CRWV -17.13%). This comes from an investment Altimeter made when CoreWeave was still a private company. As of the close of trading on June 4, Altimeter's 2,999,536 shares were worth about $489 million Let's explore some of the core themes in the ongoing AI revolution to try and discern what may have motivated these moves. From there, I'll break down CoreWeave's business and recent price action to help determine if the stock is a good buy right now. Considering how robust demand has been for high-end graphics processing units (GPU) and memory storage chips, reducing exposure to names such as Nvidia, Micron, and Taiwan Semi looks like a head-scratcher on the surface. However, this is not the first time that Gerstner has shown some contrarian characteristics in his investment style. While I cannot say for certain what Altimeter's current thesis is regarding chip stocks or the AI movement more broadly, I've come up with some reasons that may help justify the fund's recent moves. According to industry estimates, Nvidia currently controls roughly 90% (or more) of the data center GPU market. While a lead like that might suggest Nvidia's moat is insurmountable, there are some risks to consider. First, Nvidia's revenue sources are heavily concentrated among cloud hyperscalers such as Amazon, Alphabet, and Microsoft. Each of these companies has been developing their own custom AI chips, potentially signaling their intentions to migrate away from Nvidia's architecture over time. When you layer on top that the fact that Advanced Micro Devices has steadily been gaining momentum in the data center arena -- as its deals with Oracle, Microsoft, and Meta Platforms demonstrate -- Nvidia's growth could be on course for some deceleration. Lastly, one of the storm clouds hanging over Nvidia at the moment is its exposure to China. New U.S. export controls and President Donald Trump's tariffs could cut into its sales there. Micron operates in a unique pocket of the AI realm. It specializes in memory storage chips, which are vital hardware for data centers, personal computers, and smartphones, among other technologies. With that said, memory chips are relatively commoditized. On top of that, a shift toward cloud-based AI infrastructure could potentially serve as a headwind for Micron's hardware-centric chip memory business. Taiwan Semiconductor specializes in fabrication services -- its foundries are where chips designed by Nvidia, AMD, Broadcom, and a host of others are actually manufactured. While demand for GPUs and other types of AI chips is strong, a deceleration in sales growth from key customers (i.e., Nvidia) could trickle down to TSMC's business, too. Furthermore, most of TSMC's factories are located in Taiwan. Given the ongoing geopolitical pressures Taiwan faces from China, it's possible that U.S. chip designers like AMD or Nvidia could begin to turn to alternative foundry providers such as Intel. CoreWeave is a cloud computing infrastructure provider that offers its clients access to Nvidia GPUs and a host of other chip integrations. As such, its business is not as exposed to the time it takes to design and manufacture sophisticated hardware -- unlike the names explored above. In a way, this makes the hyperscaler more nimble than other chip and data center stocks, allowing the company to scale at a faster pace. CoreWeave is able to take advantage of the booming chip landscape but more so on the AI training and inferencing side. Ultimately, it fills the gap between producing chipsets and accessing optimized AI cloud infrastructure. It's not that Nvidia, Micron, or TSMC are poor investment choices right now. It's simply that those businesses might be reaching levels of maturity, whereas CoreWeave's model could be in the early phases of exponential expansion. The chart below illustrates how CoreWeave's price-to-sales (P/S) ratio has progressed since its initial public offering (IPO) earlier this year. There are a couple of big takeaways from this chart. First, it's clear that CoreWeave has experienced notable valuation expansion. In my view, outsize momentum is propelling CoreWeave stock right now -- and buying in the wake of its recent climb could leave you as an unsuspecting bag holder. In addition, CoreWeave's P/S multiple is almost fourfold that of Oracle -- which also provides core data center infrastructure services. Oracle is a mature, profitable business, unlike CoreWeave's high-cash-burn operation. While I understand the thesis behind CoreWeave's value proposition in the AI landscape, I think the stock is overbought right now. I would pass on investing at its current valuation, but would keep tabs on the company and its growth prospects.

Is This Monster Artificial Intelligence (AI) Stock -- a 251% Gainer Since Its IPO Earlier This Year -- Becoming Wall Street's Next Meme Stock? | The Motley Fool

When it comes to artificial intelligence (AI) chip stocks, names such as Nvidia, Broadcom, Advanced Micro Devices, and Taiwan Semiconductor Manufacturing dominate the talking points among financial circles. These companies are at the forefront of designing and manufacturing advanced chipsets known as graphics processing units (GPUs). While investing in semiconductor stocks has generally been a great idea over the last two years, the stocks above have taken a bit of a breather during 2025. Uncertainty around tariff negotiations and particularly exposure to China have investors trimming their gains and looking elsewhere for now. One opportunity that has emerged as a new favorite among chip stocks is CoreWeave (CRWV 15.44%), which went public back in March. Since the initial public offering, shares of CoreWeave have rocketed by 251% as of the closing bell on June 6. Is now the time to get in on the CoreWeave trade, or is the company quickly becoming Wall Street's next big meme stock? For the last couple of years, investors could not stop buying chip design and manufacturing stocks. And to be completely honest, I think companies such as Nvidia, AMD, Broadcom, and Taiwan Semi all have bright futures. For instance, global management consulting firm McKinsey & Company recently reported that nearly $7 trillion could be allocated toward AI infrastructure spend over the next five years. Within these capital expenditures, the largest allocation is forecast to go toward hardware for AI data centers. These secular tailwinds may be justified by ongoing infrastructure initiatives such as Project Stargate here in the U.S. as well as similar buildouts overseas -- particularly across the Middle East. While this is all great for Nvidia and its peers, why are investors flocking to CoreWeave as of late? My thinking is that the company's unique business model is becoming increasingly favored among chip stock investors. Allow me to explain. CoreWeave offers an infrastructure services business in which customers can access clusters of Nvidia GPUs among other architectures via the cloud. This is an interesting model, as it essentially allows generative AI developers an efficient way to access the industry's best hardware without needing to directly order it, wait for the chips to be manufactured, and then work with integrated systems designers to build custom training and inferencing clusters. At the end of the first quarter (March 31), CoreWeave boasted $14.7 billion in remaining performance obligations plus another $11.2 billion in committed contracts from a strategic deal signed with OpenAI. Given the company has roughly $25.9 billion in backlog, let's see how quickly Wall Street thinks CoreWeave can recognize this growth. In the chart above, investors can see that the general consensus among analysts is for CoreWeave to roughly triple its revenue over the next two years as well as transition to a profitable business. Overall, I'd say this is a bright picture. However, CoreWeave's valuation suggests that most (if not all) of this good news is priced into the stock already. I see the appeal of investing in infrastructure services businesses as part of the broader AI equation. But right now, CoreWeave is experiencing outsized levels of valuation expansion -- leaving little to no room for error when it comes to an investment. Said differently, buying a stock at record levels requires a high conviction that the price will continue rising. While that may well be the case for CoreWeave in the long run, I think investing in the company at its current price isn't prudent. Investing in momentum stocks can be a risky strategy, and to me, I would not be surprised to see CoreWeave's price normalize sooner than later. The bright side is that if CoreWeave shares begin to show some weakness, that could be an opportunity for smart investors to buy the dip. So while I think CoreWeave could be a winner in the long run, I think there are more reasonable opportunities to buy the stock as opposed to right now. For the time being, I do see CoreWeave exhibiting some characteristics of a meme stock, and I think shares are best left avoided.

Prediction: 1 Artificial Intelligence (AI) Stock to Buy Before It Soars 100% in the Next Year (Hint: Not Palantir) | The Motley Fool

Palantir Technologies (PLTR -7.78%) has been an incredible investment throughout the artificial intelligence (AI) boom. The stock has advanced 1,900% since January 2023. But CoreWeave (CRWV -17.13%) could be the next big winner as the AI boom continues to unfold. The company held its initial public offering two months ago, and the share price has already tripled, but I think CoreWeave stock can double again in the next year. Here's why. CoreWeave provides cloud infrastructure and software services. Its platform (called a GPU cloud) is purpose-built for demanding workloads like artificial intelligence (AI). Research company SemiAnalysis recently ranked CoreWeave as the best GPU cloud on the market, awarding it higher scores than competitors like Amazon, Microsoft, and Alphabet's Google. CoreWeave has distinguished itself from those hyperscalers in two ways. First, it is frequently the first cloud to deploy the latest Nvidia technologies due to its close relationship with the chipmaker. Second, CoreWeave is very good at running GPU clusters, such that it frequently achieves record-breaking results at the MLPerf benchmarks: objective tests that measure the performance of AI systems. CoreWeave reported tremendous first-quarter financial results. Revenue increased 420% to $981 million, and adjusted operating income (which excludes stock-based compensation and interest payments on debt) increased 550% to $162 million. As a caveat, the company reported a non-GAAP (generally accepted accounting principles) net loss of $150 million because interest payments on debt cut into profits. However, significant debt is unavoidable when building AI infrastructure, and CoreWeave has a responsible borrowing strategy involving what management calls "naturally deleveraging self-amortizing debt facilities." That means the company only takes on debt when a customer contract creates a need for additional AI infrastructure, and only if that contract more than covers the cost of the debt. CoreWeave disclosed an impressive customer list when it filed its Form S-1 with the SEC prior to its initial public offering, including IBM, Meta Platforms, Microsoft, and Nvidia. Since then, CoreWeave has won new contracts with OpenAI and an unnamed hyperscaler, such that the company now has a revenue backlog of nearly $26 billion. CoreWeave currently trades at 26 times sales. That is objectively expensive, but it seems reasonable for a company with triple-digit revenue growth and a gross margin of 73%. For instance, fellow cloud services company Cloudflare reported 27% revenue growth with a 77% gross margin in the most recent quarter, and that stock trades at 35 times sales. Here's why I think CoreWeave stock can double during the next year: Wall Street estimates trailing-12-month sales will grow 200% over the next four quarters. If that happens, shares can double while the price-to-sales ratio drops to a more reasonable 17. That seems plausible, provided demand for AI infrastructure remains robust.

Where Will CoreWeave Be in 1 Year? | The Motley Fool

The company, which rents out access to the popular Nvidia graphics processing units (GPUs) needed to power generative-AI products, went public at the end of March in an initial public offering (IPO) that was widely regarded as a disappointment. The company had to lower its IPO price due to lack of demand, and sold fewer shares than it had intended. The debut priced at $40 and the stock closed below that mark as recently as April 22, but since surged due to positive updates from the company, as well as the overall market rebound made possible by cooling trade war tensions and generally solid economic data. At the time of this writing, CoreWeave is up 270% from its IPO price, and it could move even higher as the company is delivering phenomenal growth. In addition to improving sentiment, there were a number of news items that propelled CoreWeave shares higher. First, CoreWeave signed a $4 billion deal with OpenAI in May, showing continuing demand for CoreWeave's cloud-based platform. The deal signaled a diversification of its customer base away from Microsoft., which in 2024 accounted for 62% of CoreWeave's business. Additionally, Nvidia revealed that it owned $900 million of CoreWeave stock at the end of the first quarter. That stake is now worth roughly $3 billion. CoreWeave also posted strong first-quarter results with revenue up 420% to $981.6 million, though its generally accepted accounting principles (GAAP) net loss expanded from $129.2 million to $314.6 million. CoreWeave's business model requires it to spend large sums up front on Nvidia chips, adding risk to the stock. The company's guidance called for revenue of $4.9 billion to $5.1 billion for the year, and capital expenditures of $20 billion to $23 billion. Predicting where any stock will be in a year is difficult, but CoreWeave faces additional uncertainty due to its short history as a publicly traded company, the inherent risk in its business model, the surge in its valuation, and the volatility in the broader market and in the AI sector. CoreWeave could easily top its revenue forecast for the year as its guidance, coming in its first report as a publicly traded company, is likely conservative. The forecast calls for roughly 160% in revenue growth. The company is also likely to see more big deals such as the one it just announced with OpenAI as it needs those to fuel its growth, and demand for AI computing power is still soaring. Investors appear willing to overlook CoreWeave's high debt burden in a rising interest rate environment, but the company would be rewarded if it refinanced its debt or lowered its risk in another way. A year from now, CoreWeave seems on track to have trailing revenue of around $6 billion, though its bottom-line results are much harder to predict, especially as a business that's profitable on an earnings before interest, taxes, depreciation, and amortization (EBITDA), but not on a GAAP basis. Ultimately, the company is beholden to broader demand for AI, though that seems to be safe for now. CoreWeave is a high-risk stock, but it looks well positioned to be a leader in AI cloud infrastructure as its growth rate reflects soaring demand for its services. The company is burning cash and pays a high interest on its debt, adding to the risk. However, considering the blowout growth rate and its leading position in AI cloud infrastructure, the upside potential the stock offers after its post-IPO rally is substantial. Following that logic, opening a small position wouldn't be a bad idea for risk-tolerant investors.

CoreWeave Is Up More Than 300% in Just 3 Months - But Could It Go Even Higher? | The Motley Fool

CoreWeave (CRWV -4.63%) went public in March and was one of the most anticipated IPOs of the artificial intelligence boom. It's also been one of the best-performing IPOs. CoreWeave went public at a price of $40 per share and as of this writing, the stock trades for more than four times that level. Although CoreWeave is losing money, this AI infrastructure company is growing at an incredible pace, and this has caused the stock to climb so high. Here I'll discuss what the company does, how the business is performing, and whether the stock could soar higher, even after its excellent performance in just a few months as a public company. CoreWeave is an AI infrastructure company, operating a network of data centers in the United States and Europe, and offering a cloud-based software platform that provides enterprise clients with AI computing power. Specifically, CoreWeave provides remote access to high-powered AI infrastructure such as state-of-the-art graphics processing units (GPUs) in a way that is specifically designed to handle AI workloads. CoreWeave recently reported its first-quarter 2025 earnings -- it's first report as a publicly traded company. And to say the results were strong would be a bit of an understatement. For the quarter, CoreWeave reported about $982 million in revenue, which was more than five times what it generated a year prior. The company reported a loss on the bottom line, but had about $2 billion in cash on its balance sheet (and just raised another $2 billion), so it has plenty of runway for growth. The company ended the quarter with a revenue backlog of $25.9 billion and reported some big wins including a $11.2 billion deal with OpenAI and a major partnership with IBM (IBM 1.53%). A few weeks after earnings, CoreWeave agreed to lease two large data centers from Applied Digital (APLD -4.11%) that would dramatically increase the company's capacity, triggering a wave of investor optimism and sending the stock skyrocketing to a fresh all-time high. The short answer is that it depends on whether CoreWeave can continue to outperform expectations, as it did in its first quarter earnings report. For the second quarter, the company is guiding for revenue in the range of $1.06 billion to $1.1 billion, and the consensus of analysts who follow the company calls for $1.08 billion, right in the middle of CoreWeave's range. Looking a bit further into the future, analysts are expecting a total of $5.05 billion in revenue this year and for revenue to grow another 131% to $11.66 billion in 2026. And not only that, but although CoreWeave is expected to lose money this year, analysts expect the company to become slightly profitable next year. CoreWeave is one of the most hyped AI IPO stocks in recent history, but with revenue more than quintupling year-over-year, the hype seems well-deserved. Expectations are high for CoreWeave, but if the company can continue to over-deliver on revenue growth while simultaneously crossing over into the land of profitability, the stock could certainly have further to climb. After all, there are AI companies with far slower growth rates that trade for much more than 6.7 times forward sales, so even after quadrupling in just a few months, CoreWeave isn't exactly an expensive stock.

CoreWeave Stock Is Sinking Today -- Here's What Investors Need To Know | The Motley Fool

CoreWeave stock's sharp drop isn't really being driven by specific news from today; rather, it's a retreat from the stock's recent massive run-up. The stock was up nearly 50% this week before today's fall after the company announced several catalysts. CoreWeave, which provides cloud computing services to artificial intelligence (AI) companies like Nvidia and Microsoft, announced earlier this week that it has entered into a deal with Applied Digital to lease 250 megawatts of computing power for the next 15 years. The deal greatly expands CoreWeave's total capacity and ability to serve its customers. On Wednesday, the company announced it has appointed Ernie Rogers as chief architect of strategic financing. Rogers will help CoreWeave continue to finance its rapid expansion. Michael Intrator, co-founder and CEO, explained in a statement that his "deep understanding of our business makes him uniquely qualified to help drive our next phase of growth." CoreWeave's growth has been impressive, but I'm not sold on the stock. The company is highly leveraged and, with the recent appointment of Rogers, appears to be looking to add to this debt. This makes the company highly vulnerable to any disruptions in its growth. This would already be cause for concern, but considering that CoreWeave's revenue is entirely dependent on just a handful of companies, the risk is greater. After all, its largest client, Microsoft, is a cloud provider itself. It's more than possible that CoreWeave sees a major disruption in sales that could handicap the company as it grows. Therefore, I would avoid CoreWeave stock.

Meet the Monster Stock That Continues to Crush the Market | The Motley Fool

CoreWeave has generated explosive gains since its market debut two months ago. CoreWeave (CRWV -17.13%), a provider of dedicated artificial intelligence (AI) cloud infrastructure services, launched its initial public offering (IPO) on March 28 at $40 a share. Its stock barely budged after the IPO, but it warmed up in April, heated up even more throughout May, and now trades at about $156 per share. During that same period, the S&P 500 only rose 7% as the Nasdaq Composite advanced 12%. Let's see why CoreWeave's stock more than quadrupled in just over two months -- and if it's still worth chasing today. CoreWeave was founded in 2017 as a cryptocurrency miner that purchased large quantities of GPUs to mine Ethereum. But after the cryptocurrency crash of 2018, it abandoned the crypto mining market and leveraged its large inventory of GPUs to build a cloud infrastructure platform for processing AI tasks. In 2022, it spent about $100 million to install Nvidia's (NVDA -1.44%) high-end H100 GPUs in its data centers. That massive investment paid off as the explosive growth of the AI market -- and the high costs of purchasing Nvidia's GPUs -- prompted more companies to rent CoreWeave's cloud-based GPUs to power their latest AI applications. CoreWeave also used its GPUs as collateral to secure billions of dollars in additional financing. CoreWeave's dedicated AI cloud infrastructure services differentiate it from bigger and more broadly diversified public cloud platforms like Amazon Web Services (AWS) or Microsoft (MSFT 0.69%) Azure. It claims that its dedicated approach makes it about 35 times faster and 80% cheaper than traditional cloud platforms for AI tasks. That disruptive approach attracted the attention of some big investors like Nvidia, Cisco Systems, and PureStorage, which paved the way for its market debut this year. CoreWeave now operates 33 data centers across the U.S. and Europe, up from 15 centers in 2024, 14 centers in 2023, and just three centers in 2022. Its revenue skyrocketed from $16 million in 2022 to $229 million in 2023, then surged again to $1.92 billion in 2024. In the first quarter of 2025, its revenue surged a whopping 420% year over year to $982 million. It had a revenue backlog of $25.9 billion, including a new $11.2 billion contract with OpenAI. However, CoreWeave's net loss widened from $31 million in 2022 to $594 million in 2023, then widened again to $863 million in 2024. Its operating expenses are soaring as it buys and leases more data centers, purchases more data center GPUs for Nvidia, and absorbs its higher energy fees. Its net loss more than doubled year over year to $315 million in the first quarter of 2025. A lot of CoreWeave's expansion has been driven by big debt offerings, which caused its annual interest payments to reach $361 million in 2023 and $584 million in 2024. It ended the first quarter of 2025 with $18.8 billion in total liabilities, which gives it an alarmingly high debt-to-equity ratio of 9.9. It still had nearly $1.3 billion in unrestricted cash and equivalents, but it could burn through that cash quickly and need to take on even more debt as it opens more data centers. It also plans to spend a lot more money on Nvidia's newest Blackwell GPUs. Another issue is its dependence on Microsoft, which accounted for a whopping 62% of its revenue in 2024. That customer concentration is troubling since it erodes its pricing power while giving Microsoft leverage in negotiating lower fees. It will also generate a lot of revenue from its new deal with OpenAI, but it hasn't disclosed those exact figures yet. For the full year, CoreWeave expects its revenue to more than double to between $4.9 billion and $5.1 billion. But with a market cap of $77.4 billion, the stock already trades at 15 times that estimate. It's not quite a meme stock yet, but that high price-to-sales ratio could limit its upside potential. CoreWeave might be worth nibbling on right now if you're bullish on the AI market's growth potential. However, you should also remember that it's shouldering a lot of debt, burning a lot of cash, and doesn't plan to break even anytime soon.

Is CoreWeave Stock a Buy Now? | The Motley Fool

Investing in today's stock market can be tricky given the volatile macroeconomic climate, fueled by the Trump administration's ever-shifting tariff policies. But the artificial intelligence sector remains a robust investment opportunity as organizations around the world race to build artificial intelligence (AI) capabilities. Consequently, AI stocks provide the potential for great gains. One example is CoreWeave (CRWV 3.90%). The company went public in March at $40 per share. Since then, CoreWeave stock soared to a 52-week high of $166.63 in June. This hot stock remains more than triple its IPO price at the time of this writing. Can it go higher? Evaluating whether now is the time to grab CoreWeave shares requires digging into the company and unpacking its potential as a good investment for the long haul. CoreWeave delivers cloud computing infrastructure to businesses hungry for more computing capacity for their AI systems. The company operates over 30 data centers housing servers and other hardware used by customers to train their AI and develop inference, which is an AI's ability to apply what it learned in training to real-world situations. AI juggernauts such as Microsoft, IBM, and OpenAI, the owner of ChatGPT, are among its roster of customers. The insatiable appetite for AI computing power propelled CoreWeave's business. The company's first-quarter revenue rose a whopping 420% year over year to $981.6 million. Sales growth shows no sign of slowing down. CoreWeave expects Q2 revenue to reach about $1.1 billion. That would represent a strong year-over-year increase of nearly 170% from the prior year's $395 million. The company signs long-term, committed contracts, and as a result, it has visibility into its future revenue potential. At the end of Q1, CoreWeave had amassed a revenue backlog of $25.9 billion, up 63% year over year thanks to a deal with OpenAI. The company forecasts 2025 full-year revenue to come in between $4.9 billion and $5.1 billion, a substantial jump up from 2024's $1.9 billion. Although CoreWeave has enjoyed massive sales success, there are some potential pitfalls with the company. For starters, it isn't profitable. Its Q1 operating expenses totaled $1 billion compared to revenue of $981.6 million, resulting in an operating loss of $27.5 million. Even worse, its costs are accelerating faster than sales, which means the company is moving further away from reaching profitability. CoreWeave's $1 billion in operating expenses represented a 487% increase over the prior year, eclipsing its 420% year-over-year revenue growth. Another area of concern is the company's significant debt load. CoreWeave exited Q1 with $18.8 billion in total liabilities on its balance sheet, and $8.7 billion of that was debt. To keep up with customer demand for computing power, CoreWeave has to spend on expanding and upgrading AI-optimized hardware, and that's not cheap. As it adds customers, the company must expand its data centers to keep pace. Debt is one way it's funding these capital expenditures. Among the risks of buying its stock, CoreWeave admitted, "Our substantial indebtedness could materially adversely affect our financial condition" and that the company "may still incur substantially more indebtedness in the future." In fact, its Q1 debt total of $8.7 billion was a 10% increase from the prior quarter's $7.9 billion in debt. Seeing an increase in both expenses and debt is a concern, but because CoreWeave is a newly public company, there's not much history to know how well it can manage its finances over the long term. Q1 is the only quarter of financial results it's released since its initial public offering. If subsequent quarters reveal a trend toward getting costs and debt under control while continuing to show strong sales growth, CoreWeave stock may prove to be a worthwhile investment over the long run. But for now, only investors with a high risk tolerance should consider buying shares. Even then, another consideration is CoreWeave's stock valuation. This can be assessed by comparing its price-to-sales (P/S) ratio to other AI companies, such as its customer and fellow cloud provider Microsoft and AI leader Nvidia. CoreWeave's share price surged over recent weeks, causing its P/S multiple to skyrocket past that of Nvidia and Microsoft. The valuation suggests CoreWeave stock is overpriced at this time. Although CoreWeave's sales are strong, given its pricey stock and shaky financials, the ideal approach is to put CoreWeave on your watch list. See how it performs over the next few quarters, and wait for its high valuation to drop before considering an investment.

Better Artificial Intelligence (AI) Stock: CoreWeave vs. Nvidia | The Motley Fool

There will prove to be many winners as artificial intelligence (AI) infrastructure continues to grow and AI end-uses expand. Nvidia (NVDA 1.26%) has been the Wall Street darling surrounding everything AI for the past two years. CoreWeave (CRWV 3.90%) has been getting the love most recently, though. Shares of the AI hyperscaler providing cloud services have soared about 185% in just the past month as of this writing. Nvidia stock has increased 24% in that time. CoreWeave just went public in late March, and the shares have jumped about 270% since that initial public offering (IPO). Investors may wonder if Nvidia's shine is fading, and it's time to buy CoreWeave instead. I'd argue that is flawed thinking, however. Investors may be taking a breather after the early exponential gains in Nvidia stock. Growth in the business itself has also slowed, though that was inevitable. Sales of its advanced chips in the data center segment had been growing like a weed. Revenue in that segment has been increasing in each consecutive quarter for the last two years. In the most recent fiscal quarter, that growth rate slowed to 10%, though, as seen below. Despite that trend, it's clear AI demand hasn't yet peaked. Remember, these are still sequential quarterly increases in data center sales. For perspective, that fiscal first-quarter revenue was a 73% jump compared to the prior year period. Management also guided investors to expect further revenue growth in the current quarter. So, while an unsustainable growth rate slows, the company is still solidly in growth mode. That's because it's not just Nvidia's advanced GPU and CPU chips driving sales and expanding AI infrastructure. Its AI ecosystem includes interconnect technologies, the CUDA (compute unified device architecture) software platform, and artificial intelligence processors that are part of many different types of architectures. CEO Jensen Huang recently touted Nintendo's new Switch 2 gaming console, for example. The unit includes Nvidia's AI processors that Huang claims "sharpen, animate, and enhance gameplay in real time." Nvidia has a broad array of customers. As AI factories and data centers are built, it will continue to be a major supplier and one that investors should benefit from owning. Nvidia also invests in the AI sector. It makes sense to look at where the AI leader itself sees future gains. One of the AI companies in which Nvidia holds a stake is CoreWeave. Nvidia should know CoreWeave well, too, as an important customer. CoreWeave leases data center space to companies needing the scalable, on-demand compute power it has control of from the 250,000 Nvidia chips it has purchased. It's a desirable option for enterprises that require significant computational power to process large amounts of data efficiently. There appears to be plenty of demand. But there is plenty of risk for investors, too. It just announced a new lease agreement to further increase capacity. Applied Digital, a builder and operator of purpose-built data centers, has agreed to deliver CoreWeave 250 megawatts (MW) of power load on a 15-year term lease at its recently built North Dakota data center campus. CoreWeave has the option to expand the load by an additional 150 MW in the future. Demand is quickly driving growth for CoreWeave. That's led investors to jump in and drive the stock higher in recent months. Valuation is just one major risk with CoreWeave. Customer concentration is another. Last year, Microsoft accounted for nearly two-thirds of revenue. CoreWeave also disclosed that 77% of 2024 revenue came from just its top two customers. CoreWeave is also spending massive amounts of capital to grow AI cloud capacity. It had about $5.4 billion of liquidity available as of March 31 and raised another $2 billion from a late May debt offering. That's approximately its level of capital expenditure in just the first quarter alone, though. That spending may pay off. But there are risks there as well. Customers could develop their own AI infrastructure or could redesign systems that don't require its services. CoreWeave stock also trades at a high valuation after the stock has soared. It recently had a price-to-sales (P/S) ratio of about 30. That could be cut in half this year with its strong sales growth, but it isn't earning any money yet. At the same time, Nvidia sports a price-to-earnings (P/E) ratio of about 30 based on this year's expected profits. Remember, too, that as CoreWeave grows, so do Nvidia's profits. Applied Digital CEO Wes Cummins said that its leased North Dakota data center campus will be full of Nvidia Blackwell class servers. I think the risk profile, financial picture, and massive potential for Nvidia make it the better AI stock to buy now.

CoreWeave shares surge amid short sellers' pain By Investing.com

Investing.com -- Shares of CoreWeave (NYSE:CRWV), the AI cloud computing startup, have risen +287% since its IPO at $40 per share in March, creating significant pressure on bearish investors. Short sellers have continued to target the stock despite facing estimated mark-to-market paper losses of $1.6 billion as of Monday's close, according to data from research firm S3. The stock's S3 Squeeze Risk reached the maximum level of 100 on May 5 when CRWV was trading at $51, and has maintained this peak level for over 30 consecutive days. During this period, CoreWeave shares have climbed +204%. Several metrics indicate a highly pressured short position, including the elevated Short Interest at 32% of float, notional exposure of $2.2 billion on the short side, very high SI Utilization exceeding 97%, and limited stock availability for borrowing. These factors contribute to a Crowded Score of 92.5 in S3's model. The situation represents what analysts describe as a "crowded trade under pressure" with short sellers paying premium rates exceeding 150% financing and requiring additional margin as the stock price increases. Demand from short sellers is expected to remain strong while the stock trades at current elevated levels. A key date for market participants is September 24, when the IPO lockup period expires and company insiders will be permitted to sell their stakes, potentially creating a catalyst for price correction.

CoreWeave falls as DA Davidson projects equity worth less than $5/share By Investing.com

Investing.com -- Shares of CoreWeave fell 6% on Tuesday after DA Davidson analyst Gil Luria reiterated his Underperform rating and $36 price target, citing concerns tied to the company's recently disclosed financing structure. The selloff came as investors weighed a detailed note from Luria, who argued that the disclosures, rather than reassuring, highlight deep risks to equity holders over the contract lifecycle. The AI hyperscaler has surged over 300% since its IPO debut in March, quickly becoming a new darling among AI-focused investors. Bears warn of dilution, while bulls point to potential dominance through deep NVIDIA Corporation (NASDAQ:NVDA) ties and a robust order pipeline amid accelerating compute demand globally. CoreWeave had presented a pro forma financing structure as part of its ongoing investor communications, aiming to demonstrate potential shareholder returns during the course of newly signed AI infrastructure contracts. But Luria disputed the implications of that scenario, stating: "There is no upfront equity, and no returns to current equity holders during the contract." The company proposed using a 15% equity assumption, implying an 85% loan-to-value ratio to underpin its infrastructure buildout; however, DA Davidson underscored CoreWeave's dependence on alternative leverage sources. These include vendor financing, unsecured notes, and credit lines with interest costs as high as 9.5%, which Luria estimates would require $590 million in additional debt servicing, effectively negating expected cash to shareholders. Multiple risks arise from residual asset valuation as well, according to the note. "Amazon AWS just lowered the price it charges for H200s by 50%," Luria wrote, arguing that expectations of high residual GPU value are misplaced and that the resale potential after four years could come in at less than 25% of current pricing levels. Luria also questioned the profitability of existing data center contracts. The company's investor materials used a 9% rate assumption for delayed-draw term loans (DDTLs), yet its first-quarter filings disclosed a blended rate of 12.5%, prompting concerns that "the entire value of the enterprise is owned by the debt holders." Discounting future asset values and equity dilution risks, DA Davidson estimates the equity value could be less than $5 per share longer-term, well below the current trading range. Luria wrote, "We believe that indicates a <$7.5bn four years from now as the value to shareholders, discounted 4 years, or less than $5/share for equity holders." The only notable risk to DA Davidson's view, according to the report, lies in CoreWeave's ability to raise substantial equity at current market levels. "If the company is able to raise >$10bn in a secondary offering at these levels we believe it could justify the next two years of projects," Luria noted, highlighting dilution as a potential escape valve.