Many investors may have overlooked one of the best-performing stocks in the U.S. right now: CoreWeave (CRWV). The AI cloud platform has hit the bullseye with its specialized GPU-powered cloud infrastructure, at just the right time, leading to a tripling of the stock price since March.
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Yet, the broader market continues to underestimate (and undervalue) the company’s strategic role in the rapidly expanding AI infrastructure sector. While CoreWeave may not yet be widely recognized, it holds significant potential for those with a forward-looking perspective on the AI landscape. For investors seeking focused exposure to AI beyond the typical software offerings, CRWV may represent a compelling opportunity.
An Under-the-Radar Hyperscaler with Genuine Traction
CoreWeave was founded in 2017 by a team of entrepreneurs with backgrounds in both finance and technology. Initially focused on cryptocurrency mining, the company quietly pivoted in 2020 toward cloud infrastructure, making an early bet that GPU computing would become the foundation of the next wave of technological advancements.
In April 2025, CoreWeave went public on the Nasdaq, raising approximately $1.5 billion and debuting with a market capitalization of nearly $23 billion. Since then, growth has remained robust. In FY2024, CoreWeave reported revenue of $1.92 billion, a more than 700% increase from $229 million in 2023.
What sets CoreWeave apart is its native design for the AI era. Unlike legacy cloud providers such as Amazon Web Services (AMZN) or Microsoft Azure (MSFT), which were initially architected for general-purpose computing, storage, and web hosting, CoreWeave was purpose-built to handle the high-performance demands of AI model training and inference.
It is not simply a GPU reseller; CoreWeave owns and operates its entire technology stack, including data centers, hardware, and proprietary orchestration software. This vertical integration enables it to exert a level of control over pricing, performance, and scalability that generalist cloud platforms struggle to match. While competitors such as Lambda Labs and Cerebras Systems (CBRS) are pursuing similar approaches, CoreWeave currently leads in both execution and enterprise adoption. Turning to snazzy PR stunts, including branded vehicles, has raised awareness and brand recognition.
Top Investors Look Beyond Narratives to the Financials
The financials are just as compelling as the technology. In FY2024, CoreWeave generated $1.92 billion in revenue with an impressive gross margin of 74%. On an adjusted EBITDA basis, the company reported $1.2 billion in profit, highlighting the underlying strength of its operations, despite recording a GAAP net loss of $863 million, primarily driven by substantial capital expenditures and debt servicing associated with its rapid expansion of infrastructure. This pattern is typical of capital-intensive businesses in the early stages of growth and expansion. Crucially, CoreWeave is not pursuing growth through unsustainable customer acquisition spending; instead, it is investing in building a durable, long-term foundation for AI computing infrastructure. Its ownership structure also indicates a stock that’s in it for the long haul.
CoreWeave is undoubtedly trading at a premium valuation. At the time of its IPO, the company was valued at approximately 12x trailing revenue, or closer to 15x on an enterprise value basis when accounting for debt. While these multiples may appear elevated, they are not out of line with other high-growth companies in the AI space.
Firms such as Snowflake (SNOW) and Palantir (PLTR) have historically traded at comparable or even higher valuation levels, and private companies like Databricks are reportedly targeting similar or greater valuations in the private markets. If CoreWeave can maintain strong revenue growth in the range of 30–50% annually, there is a reasonable path for it to grow into its valuation. In my view, the primary risk lies more in operational execution than in the current valuation itself.
Risks Don’t Have to Be Deal Breakers
No company experiencing rapid growth is without risk. One of the most notable concerns for CoreWeave is customer concentration. In 2024, Microsoft accounted for over 60% of the company’s total revenue—a level of dependence that is far from ideal. On one hand, it reflects a strong vote of confidence from a leading technology firm, reinforcing CoreWeave’s credibility and technical capabilities.
On the other hand, it exposes the company to significant revenue risk should Microsoft decide to shift workloads back to its own Azure platform. Additionally, while CoreWeave recently signed a five-year, $11.9 billion agreement with OpenAI—offering some diversification—this new partnership does not fully mitigate the concentration risk. Sustained long-term success will depend on CoreWeave’s ability to broaden its customer base and reduce reliance on a few large clients.
Another significant risk is CoreWeave’s substantial capital expenditure requirements. Building and scaling high-performance GPU clusters is inherently costly. To support this infrastructure expansion, CoreWeave has raised over $15 billion through a mix of equity financing and asset-backed lending. While the current returns appear strong, the model could be tested if AI demand slows or if access to capital becomes more constrained. Broader macroeconomic and geopolitical risks also loom large.
For instance, any disruption in the semiconductor supply chain, particularly involving Taiwan, a key hub for advanced chip manufacturing, could delay GPU shipments and impact CoreWeave’s operations. That said, while these risks are real, I view them as manageable and ultimately justified by the potential long-term upside.
The AI Infrastructure Era Has Just Begun
What makes CoreWeave particularly compelling is our early position in the broader AI infrastructure lifecycle. According to McKinsey, global data center demand for AI workloads is expected to grow at a compound annual rate of 20% through 2030. GPU-as-a-service—once a niche segment—is projected to become a $27 billion yearly revenue market by the end of the decade. CoreWeave is well-positioned at the forefront of this transformation, with its vertically integrated model offering the scalability and performance needed to meet surging demand.
What is the Price Target for CRWV Stock?
On Wall Street, CoreWeave has a consensus Moderate Buy rating based on seven Buys, five Holds, and zero Sells. However, the average CRWV price target is just $47.42, indicating a whopping 70% downside potential over the next 12 months. Clearly, Wall Street expects CRWV stock to give back some of its recent gains, so buying on the dip may be the best approach.
I’m Staying Bullish and Watching Closely
CoreWeave has delivered a triple-digit stock price gain to its current shareholders so far this year. However, its growth story is just beginning, given the early stages of the total addressable market CRWV is targeting.
CoreWeave’s strategic positioning is exceptionally strong, and the market it is targeting—AI infrastructure—is simply too large and too important to ignore. While the valuation is undoubtedly ambitious and the risks are real, the potential rewards are equally significant. Investing in CoreWeave offers exposure to the foundational layer of the emerging AI economy. This is not a speculative or hype-driven play; it’s a high-growth, cash-generating business that stands to benefit from what may be the most transformative technology trend of the decade.
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