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Investing.com -- CoreWeave Inc (NASDAQ:CRWV) reported a strong debut earnings release as a public company, delivering better-than-expected revenue and robust guidance. Yet, shares fell by 5.4% in Thursday’s trading, with investors focusing on the company’s aggressive capital expenditure plans.
Despite near-term pressure, analysts overwhelmingly reiterated bullish ratings and have significantly raised price targets. They cited rapid AI infrastructure demand and substantial new customer wins as the driving forces behind CoreWeave’s long-term positioning.
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The AI-oriented cloud infrastructure firm delivered first-quarter revenue of $981.6 million, surpassing estimates by over $100 million and growing 420% year-over-year. CoreWeave expects Q2 revenue of $1.06 billion to $1.1 billion and full-year revenue between $4.9 billion and $5.1 billion, well ahead of consensus estimates.
However, CapEx guidance of $3 to $3.5 billion for the second quarter, roughly three times expected revenue, led to concerns around free cash flow and dilution risk. Investors reacted negatively to the elevated spending levels despite the otherwise strong results.
BofA analyst Brad Sills raised his price target to $76 from $42 while maintaining a Buy rating, calling CoreWeave’s Q1 performance validation of its “best-of-breed” position in the AI infrastructure market.
Sills flagged better-than-expected return on net assets and strong contract signings, including a $12 billion OpenAI deal and $4 billion expansion with another large enterprise. While acknowledging CapEx came in above forecasts, he highlighted margin stability when adjusting for IPO-related costs.
Mizuho’s Gregg Moskowitz lifted his price target to $70 from $46 and reiterated an Outperform rating. He noted that the company’s top-line guidance is “materially” ahead of already strong Street expectations.
“CRWV is positioned to capture meaningful share of an AI cloud provider market growing at a server-melting pace,” Moskowitz wrote. He acknowledged near-term pressure on margins due to accelerated investment but said valuation remains reasonable.
Jefferies analyst Brent Thill raised his price target to $80 from $51. He called CoreWeave a “multi-year winner” based on customer growth and its ability to align CapEx with signed contractual deals.
Thill cited new enterprise traction and the deal with OpenAI as evidence of momentum. He said the stock’s premium to peers is justified by its unmatched growth profile in a rapidly scaling market.
Not all analysts were bullish. Citi reiterated a Neutral rating and $43 target, pointing to mixed profitability and declining RPO.