CoreWeave (CRWV) and Nebius Group (NBIS), AI cloud infrastructure providers, reported significant earnings this week, leading to share price increases of nearly 20% and 34%, respectively. This surge follows their second-quarter earnings where Nebius reported a staggering 454% year-over-year revenue growth and CoreWeave disclosed a revenue backlog of $104 billion, nearly double its market cap.
Both companies are witnessing unprecedented demand for AI infrastructure services, with CoreWeave’s backlog up 246% year-over-year. Analysts anticipate continued growth, with Zacks Consensus Estimates projecting high demand through 2027. Despite currently being unprofitable, both companies are seeing expanding profit margins, with recent contracts generating 5-10% higher margins than in previous quarters.
CoreWeave and Nebius also emphasized the longevity of their NVIDIA A100 GPUs, countering claims from short sellers about hardware depreciation, claiming a useful life of at least nine years. Their partnership with NVIDIA positions them to rapidly deploy next-generation architecture, further boosting their growth potential in the AI sector.
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