Coreweave Q1 revenue beats estimates; shares fall on CapEx guidance

Published 14/05/2025, 21:54
Updated 14/05/2025, 23:06
© Reuters.

Investing.com - Coreweave reported Thursday first-quarter revenue that topped Wall Street estimates as demand for the Nvidia-backed company’s liquid cooling solutions, used in a range of critical AI-related hardware from chips in data centers to servers, led to new business wins. On the company’s subsequent earnings call, executives offered a strong outlook and pointed to huge expansions, but high CapEx guidance scared investors away.

CoreWeave Inc (NASDAQ:CRWV), which made its public debut on Mar. 28, rose 10% in aftermarket hours, but quickly has fallen nearly 7% during its earnings call.

For the three months ended Mar. 31, Coreweave reported a loss per share of $1.49, compared with expectations for earnings of $0.66 per share. Revenue of $981.6 million, topped expectations for $859.8M.

In the coming months, the AI-hyperscaler projected Q2 revenues of $1.06-1.1 billion, outpacing analyst expectations of $986.7 million. CoreWeave expects full year 2025 revenues of $4.9-5.1 billion, pointing to significant outperformance of analyst expectations, sitting at $4.61 billion. The company also hinted at a $4 billion expansion agreement with a large AI enterprise, and indicated $21 billion raised for infrastructure and capacity expansion.  

Despite the good news, investors honed-in on the debt-heavy company’s Q2 capital expenditure guidance of $3-3.5 billion, or three times revenue expectations. Investors worry that the elevated spending could weigh on free cash flow and complicate near-term deleveraging efforts, leading to further share dilution.

As of Mar. 31, 2025, revenue backlog was $25.9B, including remaining performance obligations, or RPO, of $14.7B as the company secured key customer wins including a strategic deal with OpenAI, which added $11.2B in revenue backlog, and a partnership with IBM (NYSE:IBM) to deliver compute capacity for IBM’s Granite models.

"Demand for our platform is robust and accelerating as AI leaders seek the highly performant AI cloud infrastructure required for the most advanced applications," the company said.

(Yasin Ebrahim also contributed to this article) 

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