CoreWeave Lifts 2026 Outlook as Revenue Jumps 168%
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CoreWeave told investors on Tuesday that demand for AI computing is still strong. The cloud provider beat revenue estimates and raised its 2026 forecast, yet its borrowing costs remain the question hanging over the stock.
A bigger forecast, a bigger loss
Third-quarter revenue reached $3.66 billion, against the $3.55 billion analysts surveyed by LSEG expected. That is 168% above the roughly $1.36 billion booked a year earlier. The adjusted loss was 95 cents a share, better than the $1.16 loss the market had pencilled in.
On a reported basis the picture is rougher. The net loss was $709 million, or $1.27 per share, up from $110 million a year earlier. Adjusted figures leave out stock-based compensation.
Executives now see 2026 revenue of $13 billion to $13.3 billion and adjusted operating income of $1.275 billion to $1.375 billion. Both ranges clear what the market looked for. Analysts polled by LSEG had pencilled in $12.86 billion of revenue, and those surveyed by Visible Alpha had expected $1.07 billion of adjusted operating income. In August the ranges were $12.4 billion to $13.2 billion and $960 million to $1.15 billion. The shares rose in extended trading.
Paying for the buildout
The company owed almost $47 billion in debt at the end of the quarter. Some of its bonds have recently yielded more than 16%, and higher interest rates have driven lenders away, raising concerns about access to capital. The stock has lost over 40% of its value in a month.
Finance chief Nitin Agrawal said CoreWeave does not intend to issue more unsecured parent-level debt through 2027 at current yields. He projects under $5 billion of parent-level debt financing in that period. Debt secured against specific assets is a different market, he said, and the firm's loans there still trade around par. A new raise tied to a set of contracts is planned in the coming weeks.
CEO Mike Intrator said most of the capital needed for 2027 will come from customer pre-payments and financing from hardware partners. The company will also raise a limited amount itself. Capital spending is targeted at $37 billion to $39 billion for the full year, which would be 155% growth at the middle of the range.
Backlog and the Nvidia shadow
Contracted revenue backlog stands at $132.5 billion, up from $104 billion in June. Intrator also said that the company could sell all the capacity it has to buyers in the queue. It is holding back, he said: "We're choosing to be patient."
The quarter also brought first steps abroad. CoreWeave said it will open its first data centers in Asia, and it announced Forge, a service that runs and tests AI models. Management still expects 1.85 gigawatts of active power by the end of 2026.
The report came at a tense moment for the sector. Nvidia, which supplies the GPUs and capital these cloud providers lean on, has fallen nearly 10% since the week began. Its board said it hired the law firm Wachtell, Lipton, Rosen & Katz to investigate CEO Jensen Huang, who is caught up in a scandal over an affair with an alleged Chinese spy, and check whether national security or company secrets were put at risk.
Investors are also watching next week, when CoreWeave customer Anthropic is due to debut on the Nasdaq. Its updated prospectus pointed to a value of around $1.4 trillion after the share sale. Last week, voters in the US rejected dozens of data center development initiatives. Intrator said he expects no impact. He said that nearly all its power capacity is already switched on or approved, with construction under way.
Nebius, another neocloud caught in the same slide, is due to report earnings on Thursday.
Source: CNBC