"But as I began to look more closely at the company, I began feeling like I'd accidentally stumbled on an eldritch horror. CoreWeave is saddled with massive debt and, except in the absolute best-case scenario of fast AI adoption, has no obvious path toward profitability. There are some eyebrow-raising accounting choices. And then, naturally, there are the huge insider sales of CoreWeave stock."
"I don't think CoreWeave's weaknesses are a secret. It just seems like a lot of investors are ignoring them. Whether that's because of AI fomo or a sophisticated game of chicken - getting as much money from CoreWeave shares before the inevitable collapse as possible - I can't really say. I just know that after spending several days parsing its financials, talking to analysts and other experts, and trying to understand AI infrastructure, here's my life now:"
"CoreWeave went public in March, at a share price of $40, and at its peak this year was worth $187 a share. That was back in June. Today, the shares opened at $75.51. Some of the price decline is due to CoreWeave announcing, along with its third quarter earnings, that delays on a data center mean it'll make less money this year. The delay underscored some of the difficulties CoreWeave faces in becoming a profitable business."
CoreWeave carries heavy debt and lacks a clear path to profitability unless AI adoption accelerates rapidly. The company rents GPU-powered data center capacity to large tech firms, effectively shouldering buildout costs and taking on operational risk. Significant insider stock sales and some eyebrow-raising accounting choices raise governance and transparency concerns. Recent delays in a new data center reduced near-term revenue projections and highlighted execution risks. CoreWeave's business model concentrates demand for Nvidia GPUs by accelerating customer access to AI infrastructure. The stock debuted at $40, peaked near $187, and opened recently around $75.51 amid investor excitement and cooling sentiment.
Read at The Verge
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