CoreWeave shares jumped 20% in premarket trading Wednesday. Second-quarter revenue rose 112% to $2.6 billion, fueled by surging demand for AI compute. Wall Street analysts across the board praised the results, even as the company swung to an operating loss and carries heavy debt from its infrastructure buildout.
CoreWeave shares were last seen up 19.9% in premarket trading on Wednesday. The AI cloud company reported that second-quarter revenue rose to $2.6 billion from $1.2 billion a year earlier. The stock has gained 26% since the start of the year as of Tuesday's close.
Backlog swells past $100 billion
CoreWeave's revenue backlog stood at $104 billion as of June 30, a figure that excludes $25 billion in new customer commitments signed for the third quarter. The company guided for third-quarter revenue of $3.4 billion to $3.6 billion and raised its full-year forecast to $12.4 billion to $13.2 billion in revenue.
Still, the company is not yet profitable. Operating expenses more than doubled to $2.6 billion year-on-year. That left CoreWeave with an operating loss of $49 million, compared with operating income of $19 million a year earlier.
Wall Street calls it one of CoreWeave's cleaner quarters
Citi analysts called it “one of the cleaner quarters” for CoreWeave since its IPO, pointing to stronger pricing power and better-than-expected margins. Bernstein analyst Madison Rezaei, who has kept an underperform rating on the stock, called it the strongest earnings report in CoreWeave's history, though she still flagged concerns about the company's debt and balance sheet.
Rosenblatt Securities analyst John McPeake rates CoreWeave a buy with a $250 price target. He pointed to the company's ability to raise prices 25% in July as computing capacity stays sold out. Not everyone is convinced, though: Seaport Research's Jay Goldberg keeps a neutral rating, saying CoreWeave still needs to build a business beyond its current major customers over the long term.
New customers and deepening partnerships
The quarter's highlights included new customers such as Bentley Systems, Grammarly, Isomorphic Labs and Sunday Robotics. CoreWeave also deepened its partnership with Jane Street through a $1 billion strategic investment. Separately, Meta committed an additional $21 billion in spending with the company during the quarter.
Sources: CNBC, MarketWatch
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