CoreWeave Inc. (NASDAQ:CRWV) stock surged during Wednesday's premarket session after the company reported better-than-expected third-quarter results and raised its full-year revenue forecast.
However, Wall Street analysts remain divided over the AI cloud provider's long-term outlook. Rising debt, financing needs and data center construction risks remain key concerns.
The sharp divide reflects two competing views of CoreWeave's AI expansion. Yorkville Ives' Dan Ives compared the company to a "sailboat in like a Category 5 hurricane," citing mounting debt and financing risks. In contrast, Freedom Capital Markets' Paul Meeks said "the inflection point is here," pointing to improving margins and stronger growth prospects in 2027.
CoreWeave Revenue Jumps 168%, Beats Estimates
CoreWeave reported third-quarter revenue of $3.66 billion, up 168% year over year. Revenue topped the $3.55 billion analyst estimate.
The company posted an adjusted loss of 95 cents per share, narrower than the expected loss of $1.16.
CoreWeave ended the quarter with a $132.5 billion revenue backlog and $4.12 billion in cash and cash equivalents.
CEO Michael Intrator said quarterly revenue rose by more than $1 billion sequentially. Adjusted operating margin also reached double digits ahead of schedule.
CoreWeave raised its 2026 revenue forecast to $13 billion-$13.3 billion from $12.4 billion-$13.2 billion. The company expects capital spending of $37 billion-$39 billion.
Wall Street Sees Strong Margins, Financing Risks
Meeks told CNBC that CoreWeave's improving margins strengthened his bullish outlook for 2027.
Adjusted EBITDA margin reached 62%, beating expectations in the high-50% range. Meeks expects further improvement but warned that political opposition to data center construction could threaten growth in 2028.
Meanwhile, Jefferies analyst Brent Thill said CoreWeave delivered strong revenue, backlog and margins.
However, he questioned whether the company could convert its massive backlog into profitable revenue.
Thill maintained a Buy rating and $150 price forecast.
Analysts Warn About Debt and Data Center Delays
MoffettNathanson analyst Nick Del Deo warned that potential policy changes in Texas could delay construction and increase costs.
He also highlighted CoreWeave's financing challenges, noting that unsecured parent debt yields remain near 16%.
Meanwhile, Ives described the quarter as a step forward but warned that rising debt continues to pressure AI cloud infrastructure providers.
Ives questioned whether CoreWeave could deliver enough capacity to fulfill its $132 billion backlog.
Both analysts highlighted financing risks as CoreWeave continues its aggressive expansion.
CRWV Price Action: CoreWeave shares jumped 13.48% to $55.30 in Wednesday's premarket trading, according to market data.
