I also wanted to talk about CoreWeave.
So first, the basics. CoreWeave, a cloud AI startup backed by Nvidia, is planning to raise up to two point seven billion dollars through its initial public offering, which could give the company a market valuation of twenty-six billion dollars. The company is offering shares priced between forty-seven and fifty-five dollars each, with expected net proceeds of approximately two point three billion dollars. OpenAI will receive three hundred fifty million dollars worth of CoreWeave stock as part of this deal. Notably, Microsoft accounts for sixty-two percent of CoreWeave’s sales, which generated about one point nine billion dollars in revenue in twenty twenty-four, marking a seven hundred thirty-seven percent increase from the previous year. CoreWeave plans to trade under the symbol CRWV on the Nasdaq exchange. The company is also expanding its presence in Europe, committing two point two billion dollars to open new data centers across Sweden, Norway, and Spain by the end of twenty twenty-five.
And now the but.. Microsoft has chosen not to exercise a nearly twelve billion dollar option to purchase additional data-center capacity from CoreWeave, signaling a shift in how major tech companies are managing their artificial intelligence budgets. CoreWeave has quickly secured another buyer, with OpenAI acquiring the contract last week. Despite this decision, Microsoft reiterated its commitment to invest eighty billion dollars in AI. The company is being more strategic about its spending, according to CEO Satya Nadella, who stated on CNBC that they remain committed to their budget. CoreWeave is preparing for a significant initial public offering, seeking to raise up to two point seven billion dollars, marking it as a pivotal moment for the artificial intelligence sector. The market has reacted sensitively to any indications of potential cuts in AI spending, particularly following earlier reports that Microsoft may have been reconsidering its data-center leases. OpenAI’s chief Sam Altman noted CoreWeave’s contribution to the development of their models, emphasizing the importance of their computing power.
The Information is reporting CoreWeave is facing a reality check as it prepares for its initial public offering. Initially, CoreWeave projected revenue growth to quadruple to eight billion dollars in 2025, with a cash burn reduction to four billion dollars. However, new forecasts from analysts at major investment banks, including Goldman Sachs and JPMorgan Chase, indicate that revenue may only reach approximately four point six billion dollars this year, with cash burn rising significantly from six billion dollars last year to about fifteen billion dollars this year. These adjustments reflect a 40 percent reduction in growth expectations compared to last fall. CoreWeave is starting its investor roadshow aiming to raise a smaller amount of money than anticipated, amidst a volatile stock market, but still expects a valuation of around thirty billion dollars at the midpoint of its range. The company is under pressure to meet these more conservative projections, especially given it has one of the fastest growth rates for companies going public in recent years. CoreWeave’s IPO could be one of the largest tech listings in recent history, with plans to sell about two point five billion dollars in stock.
Why do we care?
CoreWeave is a pure-play proxy for the AI infrastructure boom, and its IPO will be a litmus test for the market’s appetite for AI scale-up bets. But the fundamentals paint a familiar picture. A company scaling revenue off a single hyperscale customer (Microsoft), operating with outsized cash burn that dwarfs current revenues, in an industry that’s rapidly learning that not all AI bets are profitable—or even sustainable
For IT service providers and cloud integrators: don’t assume AI infra demand is infinite or evenly distributed. CoreWeave’s story is a warning about customer concentration risk, shifting capex priorities, and the volatility of AI-fueled growth narratives.
CoreWeave’s IPO will be one of the biggest tech listings—and its reception will signal whether public markets still buy into the “picks and shovels” narrative of AI infrastructure. If it succeeds, it could unlock a wave of follow-on IPOs from data center and cloud infra players. It may validate the case for investing in AI-enabling infrastructure, even if application-layer ROI is still murky.
If it stumbles, we’ll see a market correction in AI cloud valuations, especially those with unproven revenue durability, and it could trigger a second-order rethink of how much AI infrastructyre is really needed—and how much demand is durable vs. speculative.