CoreWeave earnings preview: Wall Street weighs AI demand, 'risky' business structure

Wed, May 14, 2025, 12:17 PM 3 min read

Nvidia-backed (NVDA) AI information halfway institution CoreWeave (CRWV) is slated to merchandise net aft the doorbell Wednesday, its archetypal study since a volatile nationalist debut successful March.

CoreWeave is 1 of the largest holders of Nvidia’s graphics processing units and rents its information halfway capableness to Big Tech firms specified arsenic Microsoft (MSFT) and Meta (META) arsenic they scramble to unafraid coveted Nvidia chips to powerfulness their artificial quality ambitions.

The institution raised $1.5 cardinal successful its IPO successful March — much little than the $4 cardinal it had initially hoped to raise — with the banal whipsawing arsenic Wall Street and investors weighed its risky financials against bullish outlooks for AI demand. CoreWeave banal is up 66% since the company's marketplace debut.

Seven analysts tracked by Bloomberg clasp a Buy standing connected the stock, portion 9 clasp Neutral ratings. Hedgeye Risk Management holds a abbreviated presumption connected the stock.

Ahead of its earnings, DA Davidson expert Gil Luria said investors would beryllium watching CoreWeave’s commentary astir what helium called its “risky” superior structure, precocious lawsuit concentration, and AI demand.

CoreWeave has a important magnitude of debt: astir $12 cardinal worthy of indebtedness commitments with precocious involvement rates of 10% to 14%, according to Luria, who holds a Neutral standing connected the stock. CoreWeave uses its debt, borrowed against its store of Nvidia GPUs arsenic collateral, to bargain much Nvidia chips.

“ The hazard is this is simply a institution that is borrowing astatine extraordinarily precocious involvement rates successful bid to bargain a merchandise that depreciates precise rapidly successful presumption of its economical value,” Luria told Yahoo Finance successful an interrogation Wednesday.

Some 77% of CoreWeave's 2024 gross came from conscionable 2 customers, according to regulatory filings, with 62% coming from Microsoft (MSFT). And contempt gross hitting astir $2 cardinal that year, the institution inactive mislaid astir $1 billion, according to a March filing with the Securities and Exchange Commission.

Some analysts support that booming AI request means CoreWeave volition succeed. Barclays expert Raimo Lenschow, who holds an Overweight standing connected the stock, said helium expects CoreWeave’s archetypal 4th results volition beryllium “healthy” owed to “strong AI demand,” pointing to Microsoft’s caller net report, which bushed expectations arsenic the institution reaffirmed its program to walk $80 cardinal connected AI investments successful 2025.

Macquarie expert Paul Golding echoed the sentiment, saying CoreWeave’s “competitiveness, unneurotic with the outlook for the [AI] space, drives scope for further growth.”

Overall, analysts tracked by Bloomberg expect CoreWeave to study a archetypal 4th adjusted nonaccomplishment per stock of $0.16 and quarterly gross of $862 million, according to statement estimates. Looking further ahead, analysts expect its nonaccomplishment per stock volition shrink to $0.02 successful the 2nd 4th and estimation that gross volition turn to much than $1 billion.