CoreWeave Debuts on Nasdaq with $20 Billion Valuation
March 28, 2025 - CoreWeave went public on Nasdaq (17322.9909, -481.04, -2.70%) with an initial market valuation of $20 billion, making it the largest AI IPO in U.S. stock market history.
From Cryptocurrency Mining to AI Computing
Founded in 2016 as Atlantic Crypto, the company originally focused on cryptocurrency mining. Two years later, after a sharp decline in crypto prices, they rebranded to CoreWeave and started acquiring GPUs from struggling miners. They pitched a plan to investors to diversify from crypto mining to high-end GPU computing, betting that GPUs could be repurposed once crypto mining became unprofitable.
NVIDIA's Investment
In April 2023, NVIDIA invested $100 million in CoreWeave at a $2 billion valuation, acquiring a 4% stake. CoreWeave also used NVIDIA GPUs as collateral for debt financing.
The Backbone of AI Infrastructure
GPUs are CoreWeave’s most valuable asset, forming the foundation of AI infrastructure. The company’s main business revolves around selling access to data centers and NVIDIA's high-performance GPUs, which are in high demand for AI applications.
Major Deals with Microsoft and OpenAI
By constructing large-scale data centers, CoreWeave provides computing power to tech giants like Microsoft ($378.8, -11.78, -3.02%) and OpenAI. Recently, CoreWeave announced a $12 billion deal with OpenAI, which also holds approximately $350 million in CoreWeave shares.
Financial Performance
According to CoreWeave’s financial reports, its 2024 revenue reached $1.9 billion, with 60% of revenue coming from Microsoft. The top two clients accounted for 77% of its revenue. However, CoreWeave reported a net loss of $863 million last year while investing nearly $1 billion in new data centers.
Company Structure
Headquartered in Livingston, New Jersey, CoreWeave operates 32 data centers across the U.S. and Europe with approximately 800 employees. Its three founders collectively hold 30% of the company and control 80% of the voting power.
Challenges Ahead
With key clients like Microsoft investing billions in their own data centers, most of CoreWeave’s contracts will expire by 2029. The company will need to find new customers to sustain its business. Additionally, competition is emerging—China’s AI startup DeepSeek has developed AI models that achieve lower costs with reduced computing power, potentially shifting the AI race towards efficiency over raw computing power.
IPO Performance and Market Concerns
Despite the hype, CoreWeave’s IPO had a lackluster debut, opening 5% below its offering price and closing near its initial price. Just a day before the IPO, the company reduced its fundraising target from $2.7 billion to $1.5 billion.
On the same day, the Nasdaq index fell nearly 3%. Year-to-date, the index has dropped over 10%, marking its worst quarterly performance since mid-2022 and raising concerns about a potential tech stock bubble.
CEO’s Optimism
CoreWeave CEO Mike Intrator acknowledged macroeconomic challenges but remained optimistic, stating:
"Building and delivering the infrastructure required for AI is one of the true supercycles in the market. We work with customers who are constructing the backbone of AI, and demand has not declined."