CoreWeave Inc

CRWV

Market cap $36.4B

CoreWeave has a massive revenue backlog it must churn through. CoreWeave doesn't generate positive cash flows right now.

CoreWeave and Nebius are growing at incredible rates thanks to the booming demand for data center compute. Both companies seem set to deliver outstanding growth in the long run thanks to their huge backlogs.

On the surface, CoreWeave's picks-and-shovels take on AI might look exciting for investors. Don't be fooled.

This tech player launched an initial public offering back in March and saw its stock surge 300% in just three months. Customers are rushing to CoreWeave for access to top AI compute.

CoreWeave is growing revenue rapidly, but remains unprofitable. A massive backlog and aggressive build-out plan require near-flawless execution to live up to the stock's valuation.

I believe CoreWeave remains a strong buy despite a 47% share price drop. I argue that the backlog is intact despite the delay, sitting at $55.6B (almost 2x sequentially). The post-Q3 drop was driven mostly by the abrupt CapEx cut ($20–$23B to $12–$14B) from third party powered shell delivery delays, and is not a reduction in contract value. Q3 showed $1.4B in revenue (+134% yoy), $217M adjusted operating income, and a 16% adjusted operating margin, alongside continued deal activity across its customers.

Nebius (NBIS +4.20%) and CoreWeave (CRWV +4.50%) are shaping the future of artificial intelligence (AI) infrastructure with explosive revenue growth and massive expansion. Nebius benefits from rising margins and a transformative Microsoft deal, while CoreWeave's scale and long-term contracts position it for a major rebound once delays ease.

CoreWeave stock price has been in a strong downtrend in the past few months, leading to a $52 billion wipeout as its market cap dropped from $88 billion in June to $35 billion. It has dropped from the year-to-date high of $187.16 to $71.30.

CoreWeave's business hinges on strong demand for artificial intelligence chips. It carries a lot of debt, and interest expenses make it difficult for the company to turn a profit.

CoreWeave's 40% selloff from a third-party build delay and bubble chatter is timing noise in a supply-constrained AI infrastructure cycle, with demand, backlog, and build-out still ramping. With RSI deeply oversold and scenario analysis implying roughly 15%–155% 12-month upside from $72/share, CRWV offers contrarian, asymmetric returns if investors tolerate volatility and size positions near 2%. Key risks include hyperscaler concentration, leverage, and execution on ~$56 billion of backlog amid infrastructure bottlenecks, plus reliance on Nvidia's roadmap and hyperscalers' in-house silicon.