CoreWeave Launches $2.7 Billion IPO Amid AI Boom

CoreWeave, a prominent AI-focused cloud computing provider, is set to raise approximately $2.7 billion in its initial public offering (IPO), reflecting a scaled-back ambition from earlier targets due to market conditions. The company, backed by Nvidia, plans to offer shares priced between $47 and $55 each, with a potential market valuation of up to $26 billion at the top end of the range.

Key Highlights of CoreWeave's IPO

• IPO Details: CoreWeave aims to issue about 47 million shares, with existing stockholders selling an additional 1.8 million shares. The IPO is expected to price during the week of March 24, 2025.
• Market Position: As an "AI hyperscaler," CoreWeave specializes in renting out high-performance computing equipment, primarily sourced from Nvidia, to major tech firms like Microsoft, Meta, and IBM.
• Significant Partnerships: Ahead of its IPO, CoreWeave secured a landmark $11.9 billion contract with OpenAI to provide AI infrastructure. This deal includes issuing shares worth $350 million to OpenAI.
• Financial Performance: CoreWeave reported $1.9 billion in revenue for 2024, with a net loss of $863 million. Approximately 77% of its revenue came from its top two clients, with Microsoft contributing nearly two-thirds.
• Market Challenges: Despite its strong growth, CoreWeave faces a challenging IPO environment due to increased market volatility. The company has disclosed weaknesses in internal financial controls, which could impact investor confidence.

CoreWeave's IPO serves as a bellwether for the AI sector, testing investor appetite for AI-focused companies in a soft market. Its success could pave the way for other AI startups considering public listings.