🌐 CoreWeave: Sales are up, but the market expected more!
CoreWeave provides specialized cloud infrastructure for computationally intensive applications, especially in the field of artificial intelligence.
The company beat market expectations in both revenue and outlook, yet the stock is down more than 18%!
📊Important numbers:
Q2 revenue: $1.21 billion vs. $1.08 billion expected, which corresponds to an annual increase of more than +206%
Net loss. USD 290 million (last year USD 323 million)
Operating margin: only 2% (last year 20%) - main reason: $145m of stock-based compensation expense. 145 USD
Debt: USD 11.1 billion
🔮 Outlook:
Q3 revenue: USD 1.26-1.30bn (previous estimate USD 1.25bn)
2025 Revenue: USD 5.15-5.35 billion (USD 4.9-5.1 billion), an expected increase of over 174%!
🧠 What drives growth?
The demand for AI computing capacity is huge. CoreWeave is benefiting from the boom around OpenAI, which is not only a client but also an investor.
New customers like Goldman Sachs a Morgan Stanley are confirming their confidence in the company's platform.
Acquisition of startup Weights & Biases (for USD 1.4 billion) Strengthens position in AI model monitoring.
⚠️Co may have been responsible for the stock's decline
Profitability remains a concern. Although revenue is flying up, the company is still burning a lot of cash.
Operating margins have fallen to 2 %and that's a warning sign.
The debt burden is also rising, and CoreWeave will soon have to show it can improve profits and generate cash.
CoreWeave is a key player in the emerging ecosystem AI of the cloud. Growth is nice, but a valuation this high expects better numbers from the company.
What's your take on CoreWeave?
I don't invest much in these new companies, so I'd rather put my money in $AMZN or $MSFT.
That IPO was pretty successful and even though the stock is down 20%, it's still not exactly the cheapest.