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Tag: CoreWeave

  • CoreWeave’s (CRWV) AI Boom Story Now Competes With Securities Lawsuit

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    CoreWeave (NASDAQ:CRWV) is one of the AI stocks currently on Wall Street’s radar.

    AI-focused cloud computing company CoreWeave (NASDAQ:CRWV) received a fresh analyst update from Citizens, who reiterated its Market Outperform rating on the stock with a price target of $180.00.

    The research firm characterized CRWV as a leading GPU-as-a-Service (GPUaaS) provider poised to benefit from the rising demand for AI infrastructure. This is underpinned by multi-year contracts and a revenue backlog exceeding $56 billion.

    The firm believes CoreWeave is likely to continue capturing large-scale contracts as the GPUaaS total addressable market expands, fueled by accelerated adoption of generative AI and increased outsourcing by hyperscalers.

    It added that potential pricing pressure, customer concentration issues, and leverage concerns are some of the several risks facing the company.

    CoreWeave’s (CRWV) AI Boom Story Now Competes With Securities Lawsuit

    In other news, Leading securities law firm Bleichmar Fonti & Auld LLP said that a class action lawsuit has been filed against CoreWeave, Inc. (NASDAQ:CRWV) and certain senior executives, alleging securities fraud after significant stock drops resulting from the potential violations of the federal securities laws.

    The cloud computing company has been working with multiple partners, including Core Scientific, with which a merger agreement was announced on July 7, 2025.

    During this period, CRWV assured investors that it is well-positioned to benefit from strong demand and boasted the ability to deploy AI infrastructure at scale. However, the company overstated its capacity to meet this demand and also failed to disclose major data center construction delays.

    CoreWeave, Inc. (NASDAQ:CRWV) is a cloud platform provider that provides equipment for AI and other computing purposes.

    While we acknowledge the potential of CRWV as an investment, we believe certain AI stocks offer greater upside potential and carry less downside risk. If you’re looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on the best short-term AI stock.

    READ NEXT: 30 Stocks That Should Double in 3 Years and 11 Hidden AI Stocks to Buy Right Now.

    Disclosure: None. This article is originally published at Insider Monkey.

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  • Outsiders see a circular economy. CoreWeave’s CEO sees a ‘violent change’ that’s rattling the supply chain down to the inside of the earth | Fortune

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    Addressing one of the most persistent critiques of the current artificial intelligence boom, CoreWeave CEO Michael Intrator pushed back against the narrative of a “circular AI economy” in an appearance at the Fortune Brainstorm AI conference in San Francisco.

    While skeptics often point to the tangled web of investments between chipmakers, cloud providers, and AI startups as a financial bubble, he argued that deep industry collaboration is the only viable response to a historic supply chain crisis.

    Circular is “the incorrect way of looking at it,” Intrator told Fortune Editorial Director Andrew Nusca, reframing the dynamic not as financial engineering, but as logistical necessity. “It’s a lot of companies working to address an imbalance that is distorting the globe.”

    The concept of the “circular economy” in AI suggests that revenue is merely being recycled between a handful of tech giants—such as Nvidia investing in CoreWeave, which in turn uses that capital to buy Nvidia chips. However, Intrator described the market conditions as a “violent change in supply demand,” adding that the only way to navigate such volatility is “by working together.”

    The ‘physical bottleneck‘

    According to Intrator, the primary constraint facing the AI sector is not funding or policy, but “a physical bottleneck associated with getting … the most performant compute into the hands of the most cutting-edge players.” This scarcity forces companies to cooperate in ways that may look insular to outsiders but are essential for survival, he insisted.

    The CEO recounted a recent conversation with a mining company boss, whom he declined to name. Intrator said he learned just how deep the supply chain is being impacted: “two levels deeper,” down to the raw metals and copper required to build the infrastructure. Intrator noted that the executive specifically requested industry-wide cooperation to meet production needs.

    The mining CEO explained that to get out of this jam, “we need to work together as a group.” If he said the same thing about the AI space, Intrator reasoned, “I get accused of being in a circular economy … So that’s all I’ll say on the circular economy is, like, you do that by working together.”

    Critics warn that if a firm like CoreWeave cannot roll its debt or loses a key client, lenders could dump large volumes of used GPU chips into secondary markets, hitting hardware prices and rippling through the AI supply chain. But Intrator described a rapid, even violent escalation of demand.

    Managing ‘relentless’ demand

    CoreWeave, which specializes in parallelized computing solutions essential for AI, sits at the center of this storm.

    “The demand from the most knowledgeable, most sophisticated, largest tech companies in the world is relentless,” Intrator said. “That’s what the trend that matters to me.”

    This rapid expansion has come with volatility. Since its IPO, CoreWeave’s stock has seen significant fluctuation, a phenomenon that Intrator attributed to the market adjusting to a disruptive business model challenging the traditional cloud dominance of major tech players. Despite the “seesawing” stock price, Intrator noted that the company has been successful, with the stock trading around $90, compared to an IPO price of $40.

    He also addressed concerns regarding customer concentration. While he acknowledged that CoreWeave was previously reliant on Microsoft for 85% of its revenue, he said aggressive diversification efforts mean that no single customer now represents more than 30% of the company’s backlog.

    The super-cycle view

    Intrator urged investors to look past short-term execution hiccups, such as a data center opening delayed by a week, which he said caused “bedlam” among myopic observers. Instead, he views the current landscape as a “macro super-cycle,” where the fundamental shift from sequential to parallelized computing is opening up computational power at an order of magnitude previously unimagined.

    Ultimately, the collaboration that critics decry is the mechanic that is moving the industry forward, Intrator maintained. “The reasons that you have challenges in delivering that compute is because of policy… because of physical infrastructure … because of energy,” he said. “You do that by working together.”

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    Nick Lichtenberg

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  • This 1 Factor Is Why Some Experts Keep Shorting CoreWeave

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    Every gamer knows how fragile a graphics card can be. Under sustained heavy use—the kind of multi-hour gaming marathons you’d see from a dedicated Fortnite teen—a GPU’s effective lifespan is typically only three to five years. This fact has had some investors shorting or making dire predictions about CoreWeave in recent months. 

    Up until five years ago, GPUs were really in the domain of recreational gamers; they’ve since become the backbone of the AI industry. The complicated computational exercises that chatbots like ChatGPT need to do turn out to be fairly easy for GPUs.

    There have been a handful of companies that have also made a name for themselves by creating data centers full of GPUs to power the AI industry. Of course, there are the big players: AWS, Microsoft Azure, and then there’s the latest entrant to the fray, CoreWeave. The company, which ranked 45 on this year’s Inc. 5000 list, got its start building datacenters for cryptomining—another resource intensive activity that requires the sophisticated computing processing power of GPUs. 

    When the AI boom firmly materialized, CoreWeave was well-positioned to take advantage of the moment. As Inc. previously reported, the company closed out 2024 with nearly $2 billion in revenue, a 5,896 percent increase in growth over three years.  It’s also been a stock-market darling IPO’ing to huge fanfare earlier this year. The company started selling for about $40 a share, but despite trading near $140 in October, today hovers around $70. 

    But while CoreWeave has arguably been one of the greatest beneficiaries of the AI hypercycle, it’s also drawing the skepticism of major short sellers. 

    Earlier this year, the investment management firm Kerrisdale Capital called CoreWeave “the poster child of the AI infrastructure bubble” after revealing a short position on its stock. 

    And earlier this month Michael Burry, the famed investor, railed against hyperscalers (another term for the big GPU datacenter companies) arguing that they were underselling the lifespan of the GPUs that make up the core of their product. For its part, CoreWeave measures the depreciation (or lifespan) of its technological assets (its GPUs) in its S-1 fillings as about six years . But short sellers are betting that those GPUs are going to last about as long as the GPU of a fortnite addicted teenager, considering how resource hungry artificial intelligence actually is. That wear and tear could significantly impact the company’s profitability, especially considering the company is already reporting more than $800 million in net losses.

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    Tekendra Parmar

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  • IPO market’s red-hot year has been cooled by the shutdown and more caution among investors

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    NEW YORK (AP) — A strong year for initial public offerings on Wall Street has fizzled out due to the government shutdown and a cautious turn by investors.

    Many IPOs targeted for the end of this year will likely be pushed into next year as the Securities and Exchange Commission works to clear a backlog of hundreds of registration statements. Meanwhile, shares of companies that did make their market debuts haven’t fared well lately amid concerns that stocks have gotten too expensive after another double-digit gain for the market this year.

    “A backlogged SEC, the approaching holiday slowdown, and pressure on AI and other tech stocks are all weighing on hopes for a near-term rebound,” wrote Bill Smith, CEO of Renaissance Capital, in a note to investors.

    Despite the backlog, Wall Street is still anticipating several IPOs in November and December that were already in the later stages of the regulatory process.

    Central Bancompany was one of the bigger companies going public following the end of the government shutdown. The bank holding company for The Central Trust Bank raised $373 million from its IPO on Thursday. Still, November is on track to be among the slowest months for IPOs in 2025, according to Renaissance Capital.

    Klarna CEO Sebastian Siemiatkowski, right, rings a ceremonial bell as his company's IPO begins trading on the floor of the New York Stock Exchange, Wednesday, Sept. 10, 2025. NYSE President Lynn Martin applauds at left. (AP Photo/Richard Drew)

    Wall Street anticipates that medical supplies company Medline could go public in December, potentially raising up to $5 billion, while cryptocurrency technology company BitGo remains another potential IPO for next month.

    The more cautious turn for the market has also checked the gains of some more recent IPOs, sending some falling sharply since their debuts.

    Web design software company Figma has essentially lost all its gains since going public in July. It more than tripled on its first day of trading after pricing at $33 per share. It is now trading slightly above the IPO price.

    Klarna, the Swedish buy now, pay later company priced its IPO at $40 per share in September and is currently trading close to $29 per share. Cloud computing company CoreWeave also priced its IPO at $40 per share, in March. It surged in the months following its IPO, but has pulled back significantly to about $72 per share.

    Software company Navan went public at $25 per share in the midst of the government shutdown but failed to gain much ground and is now trading at about $15.

    The benchmark S&P 500 is having a bleak November. It’s down 3.5% for the month, with much of that decline being led by the tech sector, which had been driven higher by enthusiasm over developments in artificial intelligence. Wall Street has grown more concerned about whether the gains have been justified.

    The S&P 500 is still up more than 12% for the year and the tech-heavy Nasdaq is up more than 15%.

    Renaissance Capital’s IPO Index is down about nearly 0.8% so far this year as of Friday and has been falling against the S&P 500 since mid-October.

    “What that shows is that investors very quickly monetized, they didn’t want to take the long-term risk,” said Samuel Kerr, head of global equity capital markets at Mergermarket.

    Still, overall demand for IPOs remains strong. Even with the recent pullback, the broader market remains expensive, especially within the influential technology sector. IPOs have traditionally been another way for investors to get into the market at a less expensive entry point.

    “Increasingly, as a money manager, you have to find other places to make money and typically, IPOs are that place,” said, David Kaufman, partner and co-chair of the corporate & securities practice at Thompson Coburn LLP. “You continue to have all these large mutual funds and money managers with excess cash and no place to put this cash.”

    The broader market’s direction in the new year will determine the costs and types of IPOs. Some of the more anticipated big tech names that could go public in 2026 include AI-focused software company Databricks and graphic design app Canva. Wall Street also considers financial technology Plaid as another possible 2026 IPO.

    Any visible lull in IPO activity through the rest of the year is partially masking a flurry of activity beneath the surface as companies go through the regulatory process.

    “It’s a busy time for lawyers and bankers trying to tee things up for the first and second quarter of next year,” Kaufman said.

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  • Anthropic, Microsoft announce new AI data center projects as industry’s construction push continues

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    Artificial intelligence company Anthropic announced a $50 billion investment in computing infrastructure on Wednesday that will include new data centers in Texas and New York.

    Microsoft also on Wednesday announced a new data center under construction in Atlanta, Georgia, describing it as connected to another in Wisconsin to form a “massive supercomputer” running on hundreds of thousands of Nvidia chips to power AI technology.

    The latest deals show that the tech industry is moving forward on huge spending to build energy-hungry AI infrastructure, despite lingering financial concerns about a bubble, environmental considerations and the political effects of fast-rising electricity bills in the communities where the massive buildings are constructed.

    Anthropic, maker of the chatbot Claude, said it is working with London-based Fluidstack to build the new computing facilities to power its AI systems. It didn’t disclose their exact locations or what source of electricity they will need.

    Another company, cryptocurrency mining data center developer TeraWulf, has previously revealed it was working with Fluidstack on Google-backed data center projects in Texas and New York, on the shore of Lake Ontario. TeraWulf declined comment Wednesday.

    A report last month from TD Cowen said that the leading cloud computing providers leased a “staggering” amount of U.S. data center capacity in the third fiscal quarter of this year, amounting to more than 7.4 gigawatts of energy, more than all of last year combined.

    Oracle was securing the most capacity during that time, much of it supporting AI workloads for Anthropic’s chief rival OpenAI, maker of ChatGPT. Google was second and Fluidstack came in third, ahead of Meta, Amazon, CoreWeave and Microsoft.

    Anthropic said its projects will create about 800 permanent jobs and 2,400 construction jobs. It said in a statement that the “scale of this investment is necessary to meet the growing demand for Claude from hundreds of thousands of businesses while keeping our research at the frontier.”

    Microsoft has branded its two-story Atlanta data center as Fairwater 2 and said it will be connected across a “high-speed network” with the original Fairwater complex being built south of Milwaukee, Wisconsin. The company said the facility’s densely packed Nvidia chips will help power Microsoft’s own AI technology, along with OpenAI’s and other AI developers.

    Microsoft was, until earlier this year, OpenAI’s exclusive cloud computing provider before the two companies amended their partnership. OpenAI has since announced more than $1 trillion in infrastructure obligations, much of it tied to its Stargate project with partners Oracle and SoftBank. Microsoft, in turn, spent nearly $35 billion in the July-September quarter on capital expenditures to support its AI and cloud demand, nearly half of that on computer chips.

    Anthropic has made its own computing partnerships with Amazon and, more recently, Google.

    The tech industry’s big spending on computing infrastructure for AI startups that aren’t yet profitable has fueled concerns about an AI investment bubble.

    Investors have closely watched a series of circular deals over recent months between AI developers and the companies building the costly chips and data centers needed to power their AI products. Anthropic said it will continue to “prioritize cost-effective, capital-efficient approaches” to scaling up its business.

    OpenAI had to backtrack last week after its chief financial officer, Sarah Friar, made comments at a tech conference suggesting the U.S. government could help in financing chips needed for data centers. The White House’s top AI official, David Sacks, responded on social media platform X that there “will be no federal bailout for AI” and if one of the leading companies fails, “others will take its place,” though he also added he didn’t think “anyone was actually asking for a bailout.”

    OpenAI CEO Sam Altman later confirmed in a lengthy statement that “we do not have or want government guarantees” for the company’s data centers and also sought to address concerns about whether it will be able to pay for all the infrastructure it has signed up for.

    “We are looking at commitments of about $1.4 trillion over the next 8 years,” Altman wrote. “Obviously this requires continued revenue growth, and each doubling is a lot of work! But we are feeling good about our prospects there.”

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  • CoreWeave Offered a Crypto Miner $9 Billion to Gain Data Centers—But Got Rejected

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    Crypto miner Core Scientific terminated a $9 billion deal yesterday for its sale to AI cloud-computing company CoreWeave. After months of investor and proxy campaigns battling the agreement, shareholders voted against the proposal. 

    While CoreWeave shares fell 3.9 percent in afternoon trading, the price of Core Scientific’s stock rose slightly. 

    The deal was first announced in July, with CoreWeave hoping to obtain the energy and data center capacity needed to power its raising demand. CoreWeave already rents data centers and computing power from Core Scientific, so the acquisition meant it would own those spaces, opening up opportunities to scale its business.

    On October 15, Core Scientific’s board urged shareholders to vote for the agreement, stating it had “unanimously determined” the deal would be optimal for stockholders.

    But Two Seas Capital, which claims to be the largest of Core Scientific’s active shareholders, said it would vote against the deal on the basis of sale process, deal structure, and valuation concerns. The adviser said the sale “materially undervalues” Core Scientific, and warned that the fixed exchange ratio would expose its shareholders to the price performance of CoreWeave’s shares.

    Another proxy advisory firm, Institutional Shareholder Services, expressed a similar stance. It suggested Core Scientific should remain a standalone company per its recent success. 

    Yesterday wasn’t the first time Core Scientific has rejected a CoreWeave deal. In June 2024, the company turned down CoreWeave’s all-cash buyout offer.

    Some analysts hypothesize that shareholders believe their companies are worth more right now because of the current high stock values of AI companies.

    “[Shareholders] believe their value should be higher based on current valuations of comparable companies, which we see as more a sign of AI trade froth than actual economic value,” said Gil Luria, analyst at financial services partner D.A. Davidson. 

    Michael Intrator, co-founder, chairman, and CEO of CoreWeave, commented on the terminated deal in a Thursday press release.

    “We respect the views of Core Scientific stockholders and look forward to continuing our commercial partnership,” he says. “CoreWeave’s strategy remains unchanged. We will continue to execute with discipline against our roadmap to create long-term shareholder value, including through opportunistic and strategic M&A.”

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    Ava Levinson

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  • CoreWeave: Are Data Centers Going the Way of the Mall?

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    CoreWeave, which builds data centers and leases compute power to AI companies announced a $14 billion contract with Meta this week, and last week announced a contract expansion with OpenAI with a total value of $22 billion.

    CoreWeave is in turn pouring billions into concrete, steel, and power infrastructure, and investors cheer every new megawatt as if it automatically increases the company’s value. CoreWeave’s stock price was up 15 percent Tuesday, the day the Meta deal was announced.

    But the market—which focuses so much on the energy component of data centers—is ignoring an extreme risk when it comes to data centers. The buildings may last for decades, but the hardware inside does not.

    At a valuation of more than $61 billion with zero profits, CoreWeave is essentially a bet that GPUs will hold value longer than their real economic life.

    CoreWeave: The Big Short?

    DISCLOSURE: I’m not short, nor have I ever owned CoreWeave Stock (CRVW) in any capacity…yet. For now i’m just fascinated by the topic.

    GPUs can lose 20 to 30 percent of their value every year while chip innovation cycles accelerate. Just this week, Huawei announced a ramp-up of AI chip production on par with NVIDIA, adding even more depreciation pressure. As The Financial Time’s Bryce Elder wrote in March: “Six years in AI is an eternity. Nvidia’s server-grade V100 GPU cost around $10,000 in 2019 and can now be picked up for a few hundred dollars.”

    This makes CoreWeave less of a durable infrastructure company and more of a speculative vehicle. They raise money to build facilities, secure power and buy chips. But if depreciation accelerates further, if new technologies like efficient photonic compute or cheap ASIC inference chips reduce the demand for large GPU clusters, or if the AI bubble pops and demand dissipates, the economics could collapse quickly.

    These are capital intensive, long term businesses trying to make money by slicing it into fractional short term flexibility.

    Sound familiar? That was the WeWork business model.

    What happened to WeWork when competition saturated the market and the economy took a dive? Bye bye predictable revenue stream…hello fixed costs.

    When Infrastructure Acts Like Hardware.

    I’m not saying data centers aren’t needed, they are essential to the economy. I’m just saying the business model appears to be nuts. Markets treat them like longer term assets while the value inside quickly depreciates.

    Hardware has always been the most difficult part of tech, full of companies that once looked untouchable and then failed. Even Apple came close to collapse in the 1990s.

    Today’s data centers may not produce chips, but they are exposed to the same forces that once wiped out hardware giants.

    NVIDIA’s Game.

    To me, CoreWeave and its peers feel less like the future of computing and more like shopping center operators who, after dining with tech and energy friends, spun up a business that NVIDIA was happy to fund and eventually sell to. Just look at Brookfield, which has committed $30 billion to building data centers in France and Sweden over the next 5 to 15 years.

    NVIDIA is doing the same thing with OpenAI today, round-tripping a $100M investment that simply inflates its own sales.

    Does this seem like a healthy business model?

    For investors looking past the AI hype cycle, CoreWeave does not look like the future of data centers. It looks like the big short hiding in plain sight. But hey, what do I know about data centers anyway?

    ***PS: I would NOT recommend shorting this stock in the short term. The mania and momentum in the AI sector outweigh conventional logic. Consider this piece an exploration of today’s AI bubble, not investment advice.

    If you liked this piece, subscribe to my Substack.

    The opinions expressed here by Inc.com columnists are their own, not those of Inc.com.

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    Dave Sokolin

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