CoreWeave's future revenue boom sparks excitement—and concern—among investors! On Monday, the AI data-center and infrastructure provider CoreWeave released its third-quarter financial results, a moment eagerly watched by Wall Street. One key focus was whether the company could demonstrate that its contracted future revenues might reach the $50 billion benchmark that analysts have set for this rapidly growing AI sector.
In its report, CoreWeave revealed that its revenue backlog nearly doubled, climbing to $55.6 billion from $30 billion the previous quarter. This backlog includes "remaining performance obligations" (RPOs) and other amounts expected to be recognized as revenue over time. The surge in future revenue commitments was fueled by new and ongoing contracts with major clients such as Meta, OpenAI, and the French AI startup Poolside. On the earnings front, CoreWeave also exceeded analysts’ expectations for both revenue and earnings.
However, it wasn’t all positive news. The company reported an increase in its debt load and revised its full-year revenue guidance downward. Following the earnings release and analyst call, CoreWeave's stock fell 6% in after-hours trading.
Some investors are keeping a close eye on CoreWeave, as skepticism grows around the AI boom and the simultaneous expansion of infrastructure. Critics argue that CoreWeave could act as a warning signal for the wider AI build-out, noting that the company's stock has fallen more than 30% from its mid-August highs.
The revised revenue guidance was attributed to delays in building some data centers. CEO Michael Intrator explained, "While demand for our platform is relentless, data center developers across the industry are facing unprecedented supply chain pressures. In our case, we are impacted by temporary delays from a third-party data center developer who is behind schedule."
CFO Nitin Agrawal provided updated 2025 revenue guidance of $5.05 billion to $5.15 billion, slightly lower than the $5.15 billion to $5.35 billion range provided in Q2. Intrator added that the affected customer agreed to adjust the delivery schedule and extend the contract expiration, meaning the total value of the contract remains intact.
Agrawal also announced that 2025 capital expenditure (capex) would be between $12 billion and $14 billion, a significant drop from the $20 billion to $23 billion previously forecast. However, he expects 2026 capex to skyrocket due to the growing backlog and continued strong demand for CoreWeave's cloud services. "Given our backlog growth and insatiable demand, we anticipate 2026 capex to more than double that of 2025," Agrawal said.
Revenue jumps, losses shrink, debt rises
CoreWeave reported quarterly revenues of $1.4 billion, up from $584 million in the same quarter last year, surpassing analyst estimates. Despite this growth, traditional profitability remains elusive, with a net loss of $110 million—improved from a $359.8 million loss in Q3 2024. Adjusted net loss, excluding extraordinary items, was $41 million for the quarter compared to break-even last year. Adjusted EBITDA reached $838 million, more than double the $379 million in Q3 2024.
Operating income, reflecting core business profitability, fell to $51.9 million from $117.1 million a year earlier, reducing operating margins from 20% to 4%. However, adjusted operating income, which provides a different perspective on core business performance, rose to $217 million from $125 million last year, with adjusted operating margins reaching 16% thanks to higher revenues, lower costs, and the timing of third-party data center deliveries.
Despite these mixed results, bearish analysts remain cautious. They worry that CoreWeave may struggle under the weight of its large financial commitments to expand data centers, which currently seem disproportionate to its revenues and cash flow. The company now has $9.7 billion in obligations due within the next 12 months and a total of $14 billion in current and long-term debt, up from $7.6 billion and $11 billion, respectively, last quarter. CoreWeave also faces $34 billion in scheduled lease payments for contracts starting between now and 2028. Interest expenses surged to $311 million, nearly triple the $104 million from a year earlier.
Still, optimistic investors believe CoreWeave's massive backlog of contracts will eventually outpace its debt obligations. Recently, the company secured a $14.2 billion deal to supply Meta with computing capacity and signed an agreement with Poolside for a data center featuring 40,000 of Nvidia’s highly sought-after GPUs. The big question now: Will CoreWeave’s future revenue powerhouse outweigh its rising debts, or are we seeing early signs of overextension in the AI infrastructure race? Share your thoughts in the comments—do you see a golden opportunity or a looming risk?
