CoreWeave (NASDAQ: CRWV), an AI cloud infrastructure provider, launched its initial public offering (IPO) on March 28 at $40 a share. Since then, its stock price has surged to about $156, significantly outpacing the S&P 500 and Nasdaq Composite, which increased by 7% and 12% respectively during the same period.
Founded in 2017 as a cryptocurrency miner, CoreWeave pivoted to provide dedicated cloud services for AI tasks, leveraging massive investments, including $100 million for Nvidia’s high-end GPUs. The company operates 33 data centers, expanded from just 3 in 2022, and reported revenues soaring from $16 million in 2022 to $1.92 billion in 2024. However, its net losses have also increased, reaching $863 million in 2024, raised concerns about its high debt-to-equity ratio of 9.9 and dependency on Microsoft for 62% of revenues.
For the full year, CoreWeave expects revenue between $4.9 billion and $5.1 billion, but its current market cap stands at $77.4 billion, indicating a high price-to-sales ratio. Investors are cautioned about the company’s cash burn and reliance on additional debt as it continues to expand.
