CoreWeave Stock Plummets 9% in After-Hours Trading—Even After Crushing Earnings Expectations
Wall Street's brutal love-hate relationship with tech continues.
Earnings Smash—Then the Hammer Falls
CoreWeave just posted numbers that should’ve sent champagne corks flying. Instead? Shareholders got a 9% after-hours haircut. Classic 'buy the rumor, sell the news' behavior—or maybe just hedge funds being hedge funds.
The Market’s Schizophrenic Moment
Beats estimates by a mile? Check. Investors fleeing anyway? Also check. Either the algos glitched, or someone knows something retail doesn’t. Pro tip: When stocks dive on good news, grab popcorn.
Cynic’s Corner
Remember: In modern markets, fundamentals are just decorations for the volatility rollercoaster. Enjoy the ride.
Margin drop, new customers, and billion-dollar acquisition
The company’s operating margin dropped sharply to 2%, down from 20% a year earlier, a decline largely caused by $145 million in stock-based compensation. Debt levels have now reached $11.1 billion. This was only CoreWeave’s second full quarter reporting results as a public company after its IPO in March.
Chief Executive Mike Intrator said CoreWeave has expanded its work with OpenAI, which is both a major client and an investor. He also said Goldman Sachs and Morgan Stanley have joined as customers. Both banks were underwriters for CoreWeave’s March IPO.
During the quarter, the company acquired Weights and Biases for $1.4 billion. The startup develops software that monitors AI models in production.
This deal came just months after CoreWeave’s May update, when management announced 420% revenue growth, heavier losses, and nearly $9 billion in debt. Despite those numbers, the stock price doubled in the month after that update.
Higher forecasts, Nasdaq debut, and expansion projects
For the third quarter, CoreWeave expects revenue between $1.26 billion and $1.30 billion, slightly higher than the $1.25 billion analysts were projecting. For the full year 2025, the company now expects between $5.15 billion and $5.35 billion in revenue, representing 174% growth from the current year.
That is up from the $4.9 billion to $5.1 billion guidance provided in May. Analysts surveyed by LSEG had forecast $5.05 billion.
CoreWeave’s stock began trading on the Nasdaq at the end of the first quarter after it sold 37.5 million shares at $40 each, raising $1.5 billion. By Tuesday’s close, shares were at $148.75, valuing the company at more than $72 billion before the after-hours drop.
The company also announced that a New Jersey data center project with up to 250 megawatts of capacity is on track for delivery in 2026. Mike said that before the end of this year, CoreWeave plans to roll out spot GPU rentals, which will allow customers to rent hardware at lower rates with the condition that the company can reclaim the GPUs if needed for other workloads.
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