ARK Investment Management, led by Cathie Wood, acquired 113,076 shares of CoreWeave (CRWV) on May 8, spending approximately $12.9 million. The purchase came after the Nvidia-backed cloud computing firm's stock dropped 11% to $114.15 following a quarterly report that included weaker-than-expected near-term guidance.
Wells Fargo analyst Michael Turrin raised his price target on CoreWeave to $155 from $135, maintaining an Overweight rating. Turrin's analysis emphasized the company's massive revenue backlog of $99.4 billion and its expanding infrastructure capacity, rather than focusing on the softer second-quarter outlook.
CoreWeave reported a first-quarter net loss of $740 million, with operating expenses reaching $2.22 billion. Revenue more than doubled year-over-year to $2.078 billion, up from $982 million in the same period last year. The company also increased its 2026 capital expenditure forecast to a range of $30-31 billion, up from a previous low end of $30 billion.
For the second quarter, CoreWeave expects revenue between $2.45 billion and $2.6 billion, which fell short of analyst consensus estimates, according to Reuters. The company's CEO, Mike Intrator, called it the "strongest bookings quarter" in the company's history, noting a shift in customer demand toward inference workloads rather than just training.
CoreWeave's infrastructure expansion continues at a rapid pace. The company surpassed 1 gigawatt of active power capacity and added another 400 megawatts of contracted power, bringing total contracted capacity to over 3.5 gigawatts. This expansion is critical as the company aims to convert its enormous backlog into revenue.
On Wall Street, opinions were mixed. Truist Securities raised its price target to $131 from $85 but maintained a Hold rating, citing the stock's strong year-to-date performance and noting that demand remains robust with capacity fully booked for 2025.
CoreWeave has been expanding its customer base significantly, securing new contracts including a $21 billion commitment from Meta Platforms (META) and a multi-year agreement with Anthropic. The company has also deepened relationships with Jane Street, Cohere, and Mistral.
As a member of the "neocloud" segment, CoreWeave specializes in renting out GPUs—the chips essential for AI model training and inference. The company faces significant execution risks, however, as it relies on substantial debt or equity financing to fund its capital-intensive expansion. In its recent filing, CoreWeave warned that setbacks such as power supply issues, component shortages, or rising electricity costs could impact performance.
Andrew Rocco, a stock strategist at Zacks Investment Research, compared CoreWeave's strategy to Amazon's early days, suggesting that profits can wait while scale comes first. The key question for investors remains whether the company can convert its nearly $100 billion backlog into revenue at a pace that justifies its valuation, particularly given the heavy upfront costs and interest payments ahead.
