CoreWeave Stock Drops as Significant Spending Raises Concerns Among Investors

CoreWeave Faces Sharp Stock Drop Amid Rising Losses and Increased Spending

Photo credit: Chris J. Ratcliffe/Bloomberg

CoreWeave Inc. saw its shares tumble by up to 12% in early trading after the company disclosed a larger quarterly loss than analysts had forecast, along with a significant increase in capital expenditures. This raised investor concerns about the company’s aggressive infrastructure investments.

For the fourth quarter, CoreWeave reported a loss of 89 cents per share, exceeding the average analyst estimate of 72 cents. Revenue reached $1.57 billion, slightly above the expected $1.55 billion.

Top Stories from Bloomberg

CoreWeave, which operates AI-focused data centers, announced that its capital expenditures for 2026 are projected to be between $30 billion and $35 billion, surpassing Wall Street’s expectations.

The company, part of the “neoclouds” group, provides clients with access to advanced chips and computing power. Demand for its services has soared, and CoreWeave counts OpenAI, Meta Platforms, and Microsoft among its major customers.

However, scaling up its operations has proven expensive and not without setbacks. Last November, CoreWeave reduced its annual revenue outlook due to delays in fulfilling a client contract. The company has also increased its borrowing to finance expansion projects.

CEO Mike Intrator explained in an interview that CoreWeave only takes on debt to purchase hardware like AI processors after securing customers for those resources.

“We are indeed planning substantial investments,” Intrator said. “But lenders would not provide us with this capital unless we had already secured commitments from companies like Microsoft, Meta, Nvidia, and Google.”

He emphasized that this approach is central to CoreWeave’s business model. “We make no apologies for this strategy. It’s a core part of our investment philosophy, and it’s essential for understanding our company.”

Despite these reassurances, some investors remain cautious. CoreWeave’s stock dropped to as low as $85.86 in pre-market trading on Friday, after having climbed 36% this year to close at $97.63 previously.

For 2026, CoreWeave expects revenue between $12 billion and $13 billion, with approximately $2 billion anticipated in the first quarter. Analysts had forecast $12.1 billion for the year and $2.24 billion for the first quarter. The company projects adjusted operating income to range from break-even to $40 million.

Background and Financial Moves

After going public in March 2025, CoreWeave has attracted investors eager to capitalize on the AI boom. Based in Livingston, New Jersey, the company has a close partnership with Nvidia, the leading producer of AI chips.

Last month, Nvidia invested an additional $2 billion in CoreWeave to accelerate the expansion of over 5 gigawatts of AI computing capacity by 2030. As part of this collaboration, CoreWeave will be among the first to utilize Nvidia’s upcoming products.

CoreWeave is also seeking to raise around $8.5 billion from banks such as Morgan Stanley and Mitsubishi UFJ Financial Group to fund cloud infrastructure for Meta, according to sources familiar with the matter.

The company’s debt levels have surged in recent years, reflecting a broader trend in the industry that has unsettled some investors. As of September 30, CoreWeave’s adjusted leverage ratio was about 6.9 times earnings, and the company is expected to continue burning cash for at least the next 18 months due to heavy capital investments, according to Moody’s Ratings.

More Top Reads from Bloomberg Businessweek

©2026 Bloomberg L.P.