One might say that the stock market is a curious place, where fortunes rise and fall with the capriciousness of a summer breeze. Few enterprises, however, have danced quite so sprightly through the financial quadrille as CoreWeave (CRWV), a company that, like a clever fox in a henhouse of gold, has managed to reinvent itself from a crypto-mining parvenu into a purveyor of AI computing power. With GPUs repurposed as if by some alchemical trick, it now supplies the likes of Microsoft, Nvidia, and OpenAI, who seem to have taken a rather keen interest in the young upstart’s wares.
The AI boom, that most fashionable of trends, has been a veritable feast for CoreWeave’s coffers. In its second quarter, the company’s revenue leapt with the enthusiasm of a springer spaniel at a fox hunt-206%, to be precise, landing a tidy $1.21 billion. Such figures, one must confess, make one’s head spin like a top at a children’s party.
But lo! Another feather in CoreWeave’s cap came tumbling into the newsroom on Tuesday, when it was announced that Meta Platforms (META) had entered into a sumptuous feast of funds: $14.2 billion through 2032, with a wink and a nudge to expand further. This, as one might imagine, sent the stock price into a flutter of delight, rising 12% as if it had been given a polite nudge by a well-meaning but slightly tipsy butler.
What’s happening with CoreWeave and Meta?
Meta, that most astute of socialites, has been throwing its hat into the AI ring with the vigor of a man who has just discovered a new waistcoat. In June, it acquired a 49% stake in Scale AI, a data-labeling start-up, and promptly poached its CEO, Alexandr Wang, to run its new AI lab. One might say it’s a case of “the more the merrier,” though the merriest of all was CoreWeave, whose deal with Meta now places it in the company of OpenAI, where it had previously inked a $22.4 billion agreement. A most impressive portfolio, one might say, for a company that once mined cryptocurrency with the solemnity of a Victorian undertaker.
On the same day, Meta also acquired Rivos, a chip start-up that designs RISC-V architecture-though one suspects the real attraction was the promise of full-stack AI systems, a phrase that sounds as if it were plucked from the pages of a Victorian novel. For CoreWeave, this is all rather like being invited to a ball by the Prince of Wales: a delightful honor, but one that comes with the weight of expectation.
The AI circus, as it were, is in full swing. Nebius, that clever chappie, has signed a $17 billion deal with Microsoft, while Oracle has made bold predictions about its cloud computing future. CoreWeave, for its part, has the comforting knowledge that Nvidia will buy any unused capacity, a sort of financial umbrella in a storm of uncertainty.
Is CoreWeave overvalued?
To value CoreWeave is to attempt to measure the height of a man on a unicycle: a most diverting spectacle, but one that leaves the onlooker rather breathless. The company’s revenue is tripling with the grace of a ballerina, yet it is also hemorrhaging cash, as if it had hired a troupe of jugglers to perform on a tightrope. Its debt, which will cost it over $1 billion in interest this year, is a most unwelcome guest at a garden party.
And yet! The future of AI is a most tantalizing prospect, and CoreWeave’s current market cap of $66 billion is but a modest sum compared to the potential of a fully realized cloud empire. One must remember that Amazon Web Services and Microsoft Azure began as mere whispers in the wind, and now they are the titans of the tech world. If CoreWeave can follow their lead, it may yet prove to be a most enterprising fellow.
But ah, the dangers! Should the AI bubble burst like a pricked balloon, CoreWeave may find itself in a rather awkward position. Its multi-billion-dollar deals are a fine shield, but they are no substitute for profitability. The stock, one suspects, will continue to dance to the tune of the market, with all the unpredictability of a jazz band at a tea party. A dashedly clever bit of code, what? 🚀
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2025-10-03 03:42