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Market Reaction Highlights Sensitivity to Guidance

Shares of CoreWeave declined about 8 percent in extended trading after the company issued first-quarter revenue guidance that fell short of market expectations. The drop came despite solid recent performance and triple-digit growth, underscoring how closely investors are scrutinizing forward outlooks across the AI infrastructure sector.

The company’s latest earnings release painted a mixed picture: strong historical growth and expanding demand, paired with near-term projections that suggest a more measured ramp as capacity comes online.

Quarterly Results Show Strong Growth but Wider Losses

For the most recent quarter, CoreWeave reported revenue of approximately $1.57 billion, slightly above consensus estimates. Sales surged roughly 110 percent year over year, reflecting sustained demand from AI model developers and enterprise customers scaling compute workloads.

However, profitability lagged expectations. The company posted a loss per share of about 89 cents, wider than analysts’ projections, as operating costs climbed alongside aggressive infrastructure expansion and hiring.

Adjusted EBITDA reached about $898 million, modestly below forecasts, as the company absorbed higher deployment and operational expenses tied to new data center capacity.

Guidance Falls Short of Wall Street Forecasts

Investor disappointment centered primarily on near-term guidance. CoreWeave projected first-quarter revenue between $1.9 billion and $2 billion, notably below the roughly $2.3 billion analysts had been expecting.

For the full year, the company maintained an outlook of $12 billion to $13 billion in revenue, broadly in line with consensus estimates. Management signaled that timing of infrastructure deployments and supply constraints could create variability between quarters even as long-term demand remains robust.

Massive Capacity Expansion Drives Spending Surge

CoreWeave continues to invest heavily to capture what it sees as a multi-year AI infrastructure boom. The company ended the year with about 850 megawatts of active power capacity and more than 3 gigawatts contracted, reflecting rapid scaling of its data center footprint.

Looking ahead, management plans capital expenditures in the range of $30 billion to $35 billion for 2026, a dramatic increase from just over $10 billion the prior year. The goal is to exceed 1.7 gigawatts of active capacity by the end of next year and expand well beyond current contracted levels by the end of the decade.

Executives acknowledged that these investments may pressure margins in the short term but argue they position the company to meet accelerating demand from enterprises, sovereign clients, and AI developers.

Supply Constraints and Hardware Economics

Access to high-performance GPUs remains a critical variable. The company noted ongoing tight supply of advanced chips from Nvidia, which underpin its compute offerings. Pricing for flagship accelerators has remained relatively stable, while older-generation chips have seen price increases due to sustained demand.

Management indicated that securing long-term hardware supply agreements remains a priority as AI workloads continue to scale globally.

Backlog Growth Signals Long-Term Demand Strength

Despite short-term guidance concerns, CoreWeave’s contracted backlog expanded significantly, rising to roughly $66.8 billion. The average contract duration also lengthened to about five years, providing greater revenue visibility and reinforcing the company’s position as a strategic infrastructure partner for major AI developers.

The firm also increased a key credit facility to $2.5 billion and reported total debt exceeding $21 billion following its public listing, reflecting the capital-intensive nature of the business model.

New Products and Partnerships Broaden Offering

During the quarter, CoreWeave introduced an object storage service designed to complement its compute platform and compete more directly with hyperscale cloud providers. The company also announced new partnerships with AI model builders, expanding its ecosystem and deepening customer integration.

These moves signal a shift toward a more comprehensive cloud stack, enabling customers to manage data and compute workloads within a single environment.

The Bigger Picture for Investors

CoreWeave remains one of the fastest-growing companies in the AI infrastructure space, and its stock has significantly outperformed many software peers this year. Still, the latest reaction shows that markets are prioritizing predictable growth and execution timelines as the sector matures.

While the softer quarterly outlook triggered a selloff, the combination of a large backlog, expanding capacity, and surging enterprise adoption suggests the company’s long-term growth narrative remains intact, albeit with volatility along the way.