CoreWeave rallies 7% as AI demand outweighs debt fears

CoreWeave's shares surged approximately 7% on November 10 after the company reported a staggering 168% increase in third-quarter sales to $3.66 billion. Analysts had forecasted $3.55 billion in revenue. CoreWeave's backlog expanded to $132.5 billion by the end of September, an increase from $104 billion in June. The company has set a revenue projection for 2026 between $13 billion and $13.3 billion, and adjusted operating income guidance has risen to $1.275 billion to $1.375 billion.

Despite this positive outlook, the company continues to experience a widening net loss, which reached $709 million in the latest quarter, up from $110 million a year earlier. Interest costs of $846 million are four times the operating income of $207 million. CoreWeave's debt is near $47 billion, and executives anticipate the company will only achieve adjusted profitability in the first half of 2028.

Capital spending for 2026 is guided at $37 billion to $39 billion. CEO Michael Intrator expects around $9 billion in customer prepayments and deposits within three months. He suggested that prepayments and hardware partners like Nvidia will likely cover most of the 2027 spending. While CoreWeave could sell all its capacity to waiting buyers, Intrator stated that the company is opting to retain some capacity.

Finance chief Nitin Agrawal stated that the company will not incur additional unsecured debt through 2027 at present interest rates. Agrawal also projected less than $5 billion of parent-level debt financing through 2027. The company reports that rental prices for older Ampere and Hopper chips have increased by 30% to 50% from the previous quarter.

Intrator noted that nearly all of CoreWeave's power is online or permitted. After the earnings announcement, CoreWeave's stock experienced a quick reaction in after-market trade, initially surging to $54 before falling to $46.50, and then rising again to $54.87. The stock closed at $48.73 in regular trade, slightly in the red. CoreWeave's shares have declined about 31.6% throughout 2026, with the losses narrowing to approximately 23% for the year after the overnight gain.

The stock reached an all-time high of $137.98 on May 6 but has lost close to 40% in the past month as investors shifted from AI stocks to bonds as yields hit new highs.