CoreWeave, an AI-focused cloud computing company, is gaining attention as a notable growth stock in the rapidly evolving artificial intelligence sector. As of now, its shares trade for under $100, yet analysts project an impressive upside potential of approximately 80%. With its robust performance and a staggering backlog of $55 billion, the company is well-positioned to capitalize on the increasing demand for AI infrastructure.
CoreWeave specializes in managing data centers and offering GPU-based infrastructure to enterprises engaged in building, training, or deploying AI models. By utilizing CoreWeave’s services, clients avoid the substantial capital expenses associated with establishing their own GPU data centers, enabling them to scale operations efficiently. The company reported a remarkable 134% year-over-year growth in revenue for the third quarter, reaching $1.4 billion, significantly surpassing market expectations.
Strong Financial Performance and Growth Forecast
In a noteworthy development, CoreWeave accumulated nearly $25 billion in backlog during the third quarter alone, bringing its total backlog to over $55 billion. This figure nearly doubled from the second quarter and is a record-setting pace for any cloud provider. The company also reported an adjusted EBITDA of $838 million, reflecting a strong margin of 61%. Notably, CoreWeave’s net loss per share improved to $0.22, a significant reduction from $1.82 in the same period last year, indicating enhanced operational efficiency and scale.
Diversifying its customer base, CoreWeave noted that no single client accounts for more than 35% of its backlog. Over 60% of this backlog comes from investment-grade customers, highlighting a more stable and sustainable revenue stream. In response to the increasing demand, the company is actively expanding its infrastructure. Its contractual power surged to 2.9 gigawatts, while active power rose by 120 megawatts to approximately 590 MW. CoreWeave has over 1 gigawatt available for sale, expected to come online within the next 12 to 24 months.
During this quarter, CoreWeave also made strides in international markets, including a significant project in Scotland, and established eight new data centers in the United States. It has secured major compute contracts with industry leaders such as Meta Platforms and OpenAI, strengthening its relationships with key players in the AI sector. Notably, nine of the company’s top ten customers have increased their commitments this year, indicating a growing reliance on CoreWeave’s infrastructure.
Future Prospects and Market Position
CoreWeave’s management emphasized the increasing utilization of its services by AI-native businesses, scientific research platforms, and multinational corporations. The launch of CoreWeave Federal has garnered early traction with public-sector entities, including NASA’s Jet Propulsion Lab, further diversifying its client base.
Despite capital expenditures reaching $1.9 billion, CoreWeave concluded the quarter with a strong liquidity position of $3 billion. The company has raised $14 billion in debt and equity financing year-to-date, significantly reducing its cost of capital through new lending facilities. The full-year revenue forecast has been adjusted to between $5.05 billion and $5.15 billion, aligning with consensus estimates. Analysts project a revenue increase of 136% by 2026, reaching $12 billion.
Looking ahead, CoreWeave anticipates that capital expenditures will range from $12 billion to $14 billion in 2025, with much of the delayed spending pushed into early 2026. Management forecasts that capital investment for 2026 will exceed that of 2025, driven by sustained demand for AI technologies.
With a record backlog, an expanding international presence, and a leading role in high-performance AI infrastructure, CoreWeave is poised for significant growth. Its diverse customer base and advanced technological offerings position the company to capture an increasing share of AI infrastructure spending across various industries. As such, CoreWeave is being regarded by analysts as one of the most compelling growth stocks under $100.
Currently, Wall Street rates CoreWeave’s stock, designated as CRWV, as a “Moderate Buy.” Of the 28 analysts monitoring the stock, 13 recommend a “Strong Buy,” one a “Moderate Buy,” 13 a “Hold,” and one a “Strong Sell.” The stock has risen by 82% year-to-date, with an average target price of $131.23, suggesting a potential increase of 79.4% from current levels. Some analysts have even set a high price target of $200, indicating the possibility of a remarkable 173.5% rise within the next year.
CoreWeave’s strategic positioning within the AI landscape may lead to substantial long-term profitability, making it a noteworthy consideration for investors seeking growth opportunities.
