CoreWeave beats quarterly revenue estimates as AI demand defies growing doubts
The company reported revenue of US$3.66 billion for the third quarter ended September, up from US$1.37 billion a year earlier
CoreWeave exceeded Wall Street's revenue projections in Q3, reporting $3.66 billion in revenue, up from $1.37 billion a year prior. The surge in demand for the company's cloud services helped alleviate concerns about the sustainability of AI infrastructure demand amidst mounting debt. Following the earnings report, CoreWeave shares increased by over 7% in extended trading, marking a significant rebound after a sharp decline the previous month.
The company's revenue surpassed analysts' average estimate of $3.55 billion, as reported by data compiled by LSEG. In addition, CoreWeave raised its annual revenue forecast to between $13 billion and $13.3 billion, from the previous range of $12.4 billion to $13.2 billion. CEO Mike Intrator emphasized that customer contracts are prioritized, and investments follow, as CoreWeave's investments are tied to committed demand.
This approach provides lenders with tangible assets to lend against, while customers often fund buildouts through prepayments. Despite a 40% stock price drop over the past month, CoreWeave's debt load includes $27 billion in funding, primarily from Nvidia. The company has never turned a profit and had over $50 billion in debt as of June.
CoreWeave's 2030 bonds yield approximately 15.2%, and its five-year credit-default swaps, indicative of default risk, trade at 1,135 points. The company's clientele includes Microsoft, Meta, OpenAI, and Anthropic, with Microsoft tightening oversight of some data-center projects from neocloud firms like Nebius, IREN, and Nscale.
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