CoreWeave (CRWV) shares surged 9.67% to $117.03 on Tuesday, with pre-market trading showing stability around $118.00 on Wednesday. The rally comes as investors focus on the company's potential backlog growth ahead of its inclusion in the Nasdaq-100 index, scheduled for June 22.
Nasdaq-100 Inclusion Drives Demand
The addition to the Nasdaq-100, one of the most-watched U.S. growth benchmarks, is expected to trigger buying from index-tracking funds. Over 200 funds with more than $800 billion in assets under management track the index, creating a natural demand for CoreWeave shares. Nasdaq confirmed the rebalancing will take effect before the market opens on June 22. CoreWeave CEO Michael Intrator noted that the inclusion "reflects both our growth." The company, headquartered in Livingston, New Jersey, went public in March 2025, making this rapid index addition a notable milestone for a newly listed firm.
Backlog Optimism Supports Bullish Sentiment
The recent uptick in CoreWeave's stock was triggered by an analyst note from Cantor Fitzgerald. Analyst Brett Knoblauch highlighted that equity investors might underestimate the company's backlog, which refers to contracted revenue not yet recognized as sales. According to Barron's, Knoblauch expects the backlog to surpass $131 billion by June 30. He maintained an Overweight rating on the stock with a price target of $167. CoreWeave joins Nebius Group and Astera Labs in the Nasdaq-100, and the group is increasingly viewed as key AI infrastructure plays, attracting capital flows tied to GPU capacity and rapid data-center development.
Debt and Capital Spending Remain Concerns
Despite the positive outlook, CoreWeave faces significant risks. The company has taken on substantial debt to meet surging demand for Nvidia-powered computing from major AI clients. Last week, it priced $1.25 billion in 9.625% senior notes and €2 billion in 8.500% senior notes due 2032. These notes have priority over other debt in case of financial distress. Proceeds may be used for general corporate purposes, including debt repayment. In May, Reuters reported that CoreWeave raised its 2026 capital expenditure forecast to $31 billion, with first-quarter operating expenses more than doubling. The company's second-quarter revenue guidance fell short of analyst estimates. CEO Intrator defended the strategy, stating, "I'm building a company." Zacks strategist Andrew Rocco suggested CoreWeave could "become a dominant player" if given time.
Market Context and Risks
The downside risks remain tangible. If AI spending slows, data-center costs escalate, or higher yields affect debt markets, even a large backlog may not convert to free cash flow quickly enough to support the stock. The growth-funded financing model could also squeeze equity holders if interest rates change, chip supplies tighten, or demand wanes. Currently, CoreWeave trades more like an AI infrastructure play than a typical cloud IPO. Investors will watch Wednesday's regular session to see if Tuesday's momentum can be sustained and whether the backlog narrative continues to drive interest.
