3 Things We Learned from CoreWeave’s Blowout Q3 Earnings

CoreWeave (NASDAQ: CRWV) precocious reported Q3 net that showed antagonistic EPS of 22 cents and gross of $1.36 billion, which bushed analysts' expectations of $1.29 billion. That gross fig represents a 134% year-over-year summation from $583.9 cardinal a twelvemonth ago.

Here are 3 large takeaways from the company's Q3 net report.

CoreWeave had a 3rd 4th that underscored its lasting arsenic 1 of the fastest-growing companies successful AI infrastructure. Revenue surged 134% year-over-year to $1.36 billion, beating estimates by astir 10%. Backlog astir doubled to $55 cardinal — a milestone CEO Michael Intrator called “faster than immoderate unreality successful history.” Yet, beneath the apical line, profitability remains the anemic spot. Operating income dropped 56% to $51.9 million, portion adjusted operating borderline slipped to 16%. CFO Nitin Agrawal attributed the compression to surging infrastructure costs and delays from a third-party data-center spouse that pushed immoderate deployments into Q4. The takeaway: maturation is spectacular, but margins are bending nether the value of expansion.

CoreWeave’s equilibrium expanse is powering its accelerated scale-up — astatine a price. Interest disbursal deed $311 cardinal past quarter, triple past year’s level, arsenic the institution leaned connected caller facilities and a $1.75 cardinal elder enactment offering to concern superior spending. Year-to-date, CoreWeave has raised astir $14 cardinal done indebtedness and equity, with nary large maturities until 2028. Management said it expects 2025 CapEx of $12 – 14 cardinal and much than treble that successful 2026. The institution has reduced borrowing costs by astir 900 ground points since aboriginal facilities but remains heavy leveraged. Intrator framed this arsenic “disciplined execution successful a maturation market,” portion acknowledging the exemplary depends connected sustained AI request and entree to superior markets.

Behind the bullish numbers lies a caller constraint: capacity. CoreWeave added 8 information centers and expanded contracted powerfulness to 2.9 gigawatts, but supply-chain bottlenecks are real. Intrator said 1 developer’s hold volition measurement connected Q4 results but insisted customers extended contracts without reducing worth — a motion of religion successful CoreWeave’s infrastructure. The institution is besides pursuing self-build projects successful Pennsylvania and Scotland to summation much power implicit powerfulness and timing. On the call, Intrator emphasized that its infrastructure is “fungible” — easy repurposed crossed customers and workloads — which could cushion hazard if AI spending slows.