CoreWeave (CRWV) shares tumbled 10% in premarket trading on Wednesday, August 13, after the Nvidia-backed cloud services provider posted a much larger quarterly loss than Wall Street expected, raising fresh questions about whether it can control costs while riding the AI boom.
The company, which went public in March 2025, has been one of the hottest AI infrastructure plays on the market.
Its stock has nearly tripled since its IPO, powered by insatiable demand for Nvidia GPUs used in training and running large AI models. But the latest results show the downside of scaling too fast.
In the second quarter, operating expenses jumped nearly fourfold to $1.19 billion. That surge in spending drove CoreWeave’s net loss to $290.5 million, far worse than the $190.6 million loss analysts expected (LSEG data).
The company also remains heavily leveraged, with about $8 billion in debt. Back in March, management pledged to use $1 billion from its IPO proceeds to help pay down that debt.
D.A. Davidson analysts were blunt:
“CoreWeave does not currently generate enough profit to pay all its debt holders, certainly not equity holders.”
CoreWeave operates 33 AI data centers across the U.S. and Europe, giving clients direct access to Nvidia’s cutting-edge GPUs.
CEO Michael Intrator described the AI demand as “unprecedented,” but admitted the biggest bottleneck is securing power shells, facilities capable of delivering the massive energy and infrastructure AI workloads require.
But some analysts aren’t convinced that scaling faster is the right move. As D.A. Davidson put it:
“This continues to be a business that is not worth scaling.”
Despite the big loss, CoreWeave topped revenue estimates for the quarter, showing just how strong AI demand remains. Still, Barclays analysts warned that investors will be watching the company’s operating cash flow and capital expenditures closely, especially with a potential IPO lock-up expiry looming.
That lock-up, which might end earlier than the standard six-month window, could free up insider shares for sale and put additional pressure on the stock.
The AI boom is still in full swing and CoreWeave’s problems are growing costs, heavy debt, and doubts about profitability.
Nevertheless, investors should watch out for cash burn rate, debt repayment progress, and lock-up expiration effects.
CoreWeave is a poster child for the tension in AI infrastructure: explosive revenue growth paired with equally explosive costs. The market loves its long-term AI story, but short-term, the financial math is giving investors pause.
