Is CoreWeave The Next Great AI Stock To Buy Now? What Analysts Believe
CoreWeave went public on March 28, 2025 and its shares soared 368% from $40 to $187 in June 2025. Since then, the company's stock price has declined by a third – taking a particularly hard fall after the July 7 announcement of a deal for CoreWeave to acquire its landlord, Core Scientific, for $9 billion in CoreWeave stock.
Shares of both companies have dropped significantly since then. Prior to the deal, CoreWeave stock had risen – probably too much. Although CoreWeave's revenue is growing rapidly, the company is losing money, is highly indebted, and faces intense rivalry from larger cloud services providers.
In addition, CoreWeave depends heavily on one customer – Microsoft – whose AI Copilot does not compare favorably to those from faster-growing rivals like OpenAI's ChatGPT and Perplexity. If too few customers subscribe to Copilot, perhaps Microsoft will not need as much of CoreWeave's services.
CoreWeave has issued billions of dollars in new debt – which has boosted its stock price. In May, the company sold $2 billion worth of notes – sending the stock up 19%, according to CNBC. On July 21, the company announced an additional $1.5 billion debt sale – due in 2031.
Issuing new debt to pay off existing debt does not inspire as much confidence as would operating a profitable business generating sufficient cash to repay CoreWeave's financial obligations.
It is possible this debt will help fuel faster revenue growth. That's because the company is using the money to build more cloud capacity to satisfy strong customer demand. CoreWeave stock may rise if providing more AI cloud capacity helps the company exceed investor expectations and raise guidance for the next several quarters.
In the first quarter of 2025, CoreWeave's revenue grew more than 420% to about $982 million – more than 14% ahead of expectations. If the company can exceed these high growth expectations, its stock price could rise.
However, on September 24 early investors will be free to sell their shares. Any hiccups between now and then could result in massive selling in a few months. Given CoreWeave's unprofitable business model, high debt level and excessive dependence on a more powerful supplier (Nvidia) and customer (Microsoft); owning this stock is not the best way to bet on AI's future.
What Is CoreWeave?
Livingston, New Jersey-based CoreWeave provides AI cloud-computing services. CoreWeave's services use Nvidia graphics processing units that help developers and enterprises to build AI chatbots. CoreWeave also has its own chip management software.
Founded in 2017 and focused on high-performance computing, CoreWeave operates its own data centers in the United States and Europe. Nvidia described CoreWeave's Plano, Texas supercomputer center as 'the fastest AI supercomputer in the world,' according to VentureBeat.
Understanding CoreWeave's Business Model
CoreWeave's revenue comes from renting access to the company's GPUs – often through long-term contracts with large enterprise customers. Most of the revenue comes from customers who pay CoreWeave to use their GPUs – on a per-hour or per-instance basis. CoreWeave also generates revenue by selling software services to simplify the development and deployment of AI applications.
When competing against large cloud services providers – which I profiled in my book, Brain Rush – CoreWeave enjoys several advantages. Most notably, CoreWeave's specialization in AI and GPU computing provides customers with faster processing speed and lower prices. Moreover, through its partnership with Nvidia, CoreWeave can give customers access to the latest GPU models, noted True Theta.
CoreWeave Valuation
CoreWeave's valuation is very high. At 31 times sales, according to Yahoo! Finance, the company's $59.2 billion stock market capitalization is significantly greater than the peer average of 16.7. What's more, CoreWeave shares are 21% overvalued, according to the average 12 month stock price target of 21 Wall Street analysts surveyed by TipRanks.
CoreWeave Vs. Competitors
CoreWeave competes with cloud giants, such as AWS, Microsoft Azure, Google Cloud Platform and Oracle Cloud Infrastructure, and niche players, such as GPU cloud providers Nebius, Lambda Labs and Cerebras, according to Uvation.
CoreWeave's competitive advantages described above provide customers with faster, cheaper processing as well as 'rapid scalability and dedicated support for AI models and GPU optimization,' Uvation reported.
The flip side of CoreWeave's narrower focus is its dependence on much larger companies as suppliers (Nvidia) and customers (Microsoft accounted for 72% of the company's revenue, noted the Journal). CoreWeave's capital intensive business model requires the company to incur high debt. Moreover, CoreWeave's service can only be onboarded with a scheduled meeting, rather than self-service..
Risk And Challenges Facing CoreWeave
CoreWeave's most significant business risks include the following, according to Fyva:
How CoreWeave Is Positioned For The Future
Despite these risks, there are three ways CoreWeave is well-positioned for the future. These include:
Is CoreWeave The Next Great AI Stock?
CoreWeave is not the next great AI stock. Given the risks outlined above and what appears to be an uphill climb to become profitable, investors would likely be better off investing in fast-growing AI companies with higher margins. The stock price of Nvidia – which has recently gained better access to the Chinese market from the Trump administration – could be propelled further due to its powerful technological lead and high profit margins, as I described in Brain Rush.
Bottom Line
CoreWeave enjoyed very rapid growth in the first quarter of 2025 and its stock could keep rising if the company keeps exceeding high investor expectations and raises its guidance. However, the company's position in the AI cloud industry is shaky given much better resourced rivals, excessive dependence on a big supplier and two large customers. As CoreWeave takes on more debt to pay off its existing debt, the stock appears to be overvalued.
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The company's massive stock rally has followed a sweeping business overhaul, including layoffs, leadership changes, and a pullback from costly podcast exclusivity. After spending $1 billion to build out its podcast business, the company has since scaled back and narrowed its focus. Still, it remains committed to the medium, paying over $100 million to creators in Q1 alone, including high-profile names like Joe Rogan and Alex Cooper. Here's what Wall Street expects from the upcoming results, according to Bloomberg consensus estimates: Read more here. Whirlpool stock tumbles after trimming earnings guidance Whirlpool (WHR) stock tumbled 12% after hours. The Michigan-based maker of washers and dryers reported diluted earnings of $1.17 per share on net sales of $3.7 billion. Wall Street was expecting earnings of $1.58 per share on net sales of $3.8 billion. Investors have been watching Whirlpool, which manufactures most of its appliances in the US, as a potential winner from President Trump's tariffs. However, the company hasn't seen the benefits of Trump's policies yet. In fact, retailers front-running expected tariffs appeared to weigh on the company's second quarter results. "As expected, the second quarter continued to be impacted by competitors stockpiling Asian imports into the U.S.," the company said in the earnings release. "Despite this, we are well positioned in North America with a robust pipeline of new products, the industry's leading U.S. manufacturing footprint, and favorable housing demand fundamentals. We are confident in our long-term strategy and believe that evolving tariff policies will ultimately support domestic manufacturers." Whirlpool also cut its full-year guidance to $6 to $8 a share (previously it was $10 a share) and recommended slashing its quarterly dividend to $0.90 per share from $1.75 per share. Whirlpool (WHR) stock tumbled 12% after hours. The Michigan-based maker of washers and dryers reported diluted earnings of $1.17 per share on net sales of $3.7 billion. Wall Street was expecting earnings of $1.58 per share on net sales of $3.8 billion. Investors have been watching Whirlpool, which manufactures most of its appliances in the US, as a potential winner from President Trump's tariffs. However, the company hasn't seen the benefits of Trump's policies yet. In fact, retailers front-running expected tariffs appeared to weigh on the company's second quarter results. "As expected, the second quarter continued to be impacted by competitors stockpiling Asian imports into the U.S.," the company said in the earnings release. "Despite this, we are well positioned in North America with a robust pipeline of new products, the industry's leading U.S. manufacturing footprint, and favorable housing demand fundamentals. We are confident in our long-term strategy and believe that evolving tariff policies will ultimately support domestic manufacturers." Whirlpool also cut its full-year guidance to $6 to $8 a share (previously it was $10 a share) and recommended slashing its quarterly dividend to $0.90 per share from $1.75 per share. Waste Management beats on revenue, earnings Waste Management (WM) reported earnings and revenue that beat Wall Street expectations, sending the shares marginally higher in after-hours trading. Earnings per share of $1.92 were ahead of estimates for earnings of $1.90 per share, while revenue of $6.43 billion exceeded estimates of $6.35 billion, per S&P Global Market Intelligence. "Our second quarter results are a strong demonstration of our progress on all fronts," WM CEO Jim Fish said in a release. "Our Collection and Disposal business produced robust organic revenue growth and margin expansion, achieving the Company's best-ever operating expense margin." Waste Management stock rose 0.7% following the results. Waste Management (WM) reported earnings and revenue that beat Wall Street expectations, sending the shares marginally higher in after-hours trading. Earnings per share of $1.92 were ahead of estimates for earnings of $1.90 per share, while revenue of $6.43 billion exceeded estimates of $6.35 billion, per S&P Global Market Intelligence. "Our second quarter results are a strong demonstration of our progress on all fronts," WM CEO Jim Fish said in a release. "Our Collection and Disposal business produced robust organic revenue growth and margin expansion, achieving the Company's best-ever operating expense margin." Waste Management stock rose 0.7% following the results. Tilray stock sinks after earnings Tilray stock (TLRY) reversed gains, sinking over 6% after hours after the Canadian cannabis company posted mixed quarterly results. Net revenue was $224.5 million in the fourth quarter compared to $229.9 million in the same period a year ago and $233 million estimated, per S&P Global Market Intelligence. Tilray posted adjusted earnings of $0.02 per share, compared to expectations for flat profitability. For its fiscal year ended May 31, 2026, Tilray expects to achieve adjusted EBITDA of $62 million to $72 million Listen to the earnings call live here. Tilray stock (TLRY) reversed gains, sinking over 6% after hours after the Canadian cannabis company posted mixed quarterly results. Net revenue was $224.5 million in the fourth quarter compared to $229.9 million in the same period a year ago and $233 million estimated, per S&P Global Market Intelligence. Tilray posted adjusted earnings of $0.02 per share, compared to expectations for flat profitability. For its fiscal year ended May 31, 2026, Tilray expects to achieve adjusted EBITDA of $62 million to $72 million Listen to the earnings call live here. An earnings scorecard Yahoo Finance's Josh Schafer reports: Read more here. Yahoo Finance's Josh Schafer reports: Read more here. S&P 500 hits record highs amid parade of earnings with more Big Tech results on deck The S&P 500 (^GSPC) cleared its fifth straight record high on Friday after a busy week of earnings, headlined by reports from Google (GOOG) and (TSLA). With 34% of S&P 500 companies having reported results, 80% have reported a positive earnings per share surprise, and 80% reported a positive revenue surprise. Earnings season isn't slowing down just yet, however, with more major companies reporting next week. Notable companies reporting include Big Tech giants such as Microsoft (MSFT) and Apple (AAPL) and consumer-facing names like Procter & Gamble (PG) and Mastercard (MA) that can provide an updated view on consumer health. Here's a look at the earnings calendar for the next five business days: Monday: Tilray (TLRY), Waste Management (WM), Whirlpool (WHR) Tuesday: Boeing (BA), Booking Holdings (BKNG), Caesars (CZR), Cheesecake Factory (CAKE), Merck (MRK), PayPal (PYPL), Procter & Gamble (PG), Spotify (SPOT), Starbucks (SBUX), SoFi (SOFI), UnitedHealth Group (UNH), UPS (UPS), Visa (V) Wednesday: Meta (META), Microsoft (MSFT), Arm (ARM), Altria (MO), Carvana (CVNA), Ford (F), Generac (GNRC), Harley Davidson (HOG), Hershey (HSY), Humana (HUM), The Kraft Heinz Company (KHC), Qualcomm (QCOM), Robinhood (HOOD) Thursday: Apple (AAPL), Amazon (AMZN), Bristol Myers Squibb (BMY), Cigna (CI), Coinbase (COIN), CVS Health (CVS), Mastercard (MA), Norwegian Cruise Line (NCLH), Reddit (RDDT), Roblox (RBLX), Roku (ROKU), Strategy (MSTR) Friday: Chevron (CVX), Colgate-Palmolive (CL), Exxon Mobil (XOM) The S&P 500 (^GSPC) cleared its fifth straight record high on Friday after a busy week of earnings, headlined by reports from Google (GOOG) and (TSLA). With 34% of S&P 500 companies having reported results, 80% have reported a positive earnings per share surprise, and 80% reported a positive revenue surprise. Earnings season isn't slowing down just yet, however, with more major companies reporting next week. Notable companies reporting include Big Tech giants such as Microsoft (MSFT) and Apple (AAPL) and consumer-facing names like Procter & Gamble (PG) and Mastercard (MA) that can provide an updated view on consumer health. Here's a look at the earnings calendar for the next five business days: Monday: Tilray (TLRY), Waste Management (WM), Whirlpool (WHR) Tuesday: Boeing (BA), Booking Holdings (BKNG), Caesars (CZR), Cheesecake Factory (CAKE), Merck (MRK), PayPal (PYPL), Procter & Gamble (PG), Spotify (SPOT), Starbucks (SBUX), SoFi (SOFI), UnitedHealth Group (UNH), UPS (UPS), Visa (V) Wednesday: Meta (META), Microsoft (MSFT), Arm (ARM), Altria (MO), Carvana (CVNA), Ford (F), Generac (GNRC), Harley Davidson (HOG), Hershey (HSY), Humana (HUM), The Kraft Heinz Company (KHC), Qualcomm (QCOM), Robinhood (HOOD) Thursday: Apple (AAPL), Amazon (AMZN), Bristol Myers Squibb (BMY), Cigna (CI), Coinbase (COIN), CVS Health (CVS), Mastercard (MA), Norwegian Cruise Line (NCLH), Reddit (RDDT), Roblox (RBLX), Roku (ROKU), Strategy (MSTR) Friday: Chevron (CVX), Colgate-Palmolive (CL), Exxon Mobil (XOM) Intel turnaround story could realistically take years, analyst says Intel (INTC) stock fell 9% on Friday after the company reported quarterly results on Thursday that showed it was focused on cost-cutting. Intel's revenue of $12.8 billion beat analyst expectations of $11.8 billion, per Bloomberg data, and the chipmaker issued an upbeat Q3 revenue forecast of between $12.6 billion and $13.6 billion. But the company continues to face challenges as it attempts to transform into a chipmaker as well as a chip designer. As Yahoo Finance's Laura Bratton noted in our markets blog, investors focused on Intel's manufacturing roadmap instead of its headline numbers for the quarter. Intel, once a leading global chipmaker, has fallen behind its rivals in both its own products and its attempt to manufacture chips for outside customers. 'This is a multiquarter — realistically, probably multiyear — kind of complete turnaround story before all the benefits start to show up,' TECHnalysis Research president and chief analyst Bob O'Donnell told Yahoo Finance following the report. Intel (INTC) stock fell 9% on Friday after the company reported quarterly results on Thursday that showed it was focused on cost-cutting. Intel's revenue of $12.8 billion beat analyst expectations of $11.8 billion, per Bloomberg data, and the chipmaker issued an upbeat Q3 revenue forecast of between $12.6 billion and $13.6 billion. But the company continues to face challenges as it attempts to transform into a chipmaker as well as a chip designer. As Yahoo Finance's Laura Bratton noted in our markets blog, investors focused on Intel's manufacturing roadmap instead of its headline numbers for the quarter. Intel, once a leading global chipmaker, has fallen behind its rivals in both its own products and its attempt to manufacture chips for outside customers. 'This is a multiquarter — realistically, probably multiyear — kind of complete turnaround story before all the benefits start to show up,' TECHnalysis Research president and chief analyst Bob O'Donnell told Yahoo Finance following the report. Boston Beer Company says strong profits helped brewer absorb tariff costs The Boston Beer Company (SAM) reported earnings and revenue that topped analyst expectations on Thursday, and the Samuel Adams brewer maintained its earnings outlook for the year. Profits were $5.45 per share on revenue of $625 million, versus estimates for earnings of $4.00 per share on $588 million, according to S&P Global Market Intelligence. SAM stock popped 6% on Friday, as the company also said it expects to see lower tariff costs than previously expected. For the full year, Boston Beer expects tariffs to weigh on costs by about $15 million to $20 million, instead of the $20 million to $30 million it previously modeled. "Right now, I think we're very happy with the performance," Boston Beer CEO Michael Spillane said on the earnings call. "Not only that, but that's allowed us to offset some of the tariffs that we've seen so far." The Boston Beer Company (SAM) reported earnings and revenue that topped analyst expectations on Thursday, and the Samuel Adams brewer maintained its earnings outlook for the year. Profits were $5.45 per share on revenue of $625 million, versus estimates for earnings of $4.00 per share on $588 million, according to S&P Global Market Intelligence. SAM stock popped 6% on Friday, as the company also said it expects to see lower tariff costs than previously expected. For the full year, Boston Beer expects tariffs to weigh on costs by about $15 million to $20 million, instead of the $20 million to $30 million it previously modeled. "Right now, I think we're very happy with the performance," Boston Beer CEO Michael Spillane said on the earnings call. "Not only that, but that's allowed us to offset some of the tariffs that we've seen so far."
