TLDR
- Nvidia adds $2 billion to its CoreWeave investment, raising ownership to 11.5% of the GPU rental provider
- CoreWeave revenue jumped to $1.3 billion in the latest quarter, more than doubling year-over-year
- The company holds $55.6 billion in customer contracts but faces rising debt costs of $841.4 million
- CoreWeave plans to build 5 gigawatts of AI data center capacity by 2030 with Nvidia’s support
- Operating income fell to $43.6 million as interest expenses quadrupled compared to last year
Nvidia just made its biggest bet on CoreWeave even bigger. The chip giant invested another $2 billion in the company, pushing its ownership stake to 11.5%.
CoreWeave, Inc. Class A Common Stock, CRWV
CoreWeave now represents Nvidia’s largest investment holding. The fresh capital will fund the company’s aggressive data center expansion plans targeting 5 gigawatts of capacity by 2030.
The GPU rental business model is paying off in a big way. CoreWeave’s revenue more than doubled to $1.3 billion in the most recent quarter.
Companies are lining up for access to Nvidia’s chips without the headache of building their own infrastructure. CoreWeave lets customers rent GPU power by the hour or lock in longer commitments.
The stock soared over 300% after its March 2025 IPO before cooling off. Shares finished 2025 up 79% despite late-year worries about AI spending.
Why Nvidia Keeps Writing Checks
CoreWeave built its entire business around Nvidia’s GPUs. These chips remain the top choice for AI training and deployment.
The partnership goes beyond simple vendor relationships. Nvidia committed to paying for unused CoreWeave capacity through April 2032, up to $6.3 billion total.
That backstop gives CoreWeave room to build without worrying about empty data centers. It also signals Nvidia’s long-term confidence in the business model.
The new investment guarantees CoreWeave gets first access to Nvidia’s newest tech. This includes the Rubin platform, Vera CPUs, and BlueField storage systems.
CoreWeave serves major players like Microsoft and Meta. The customer contract backlog reached $55.6 billion as of the third quarter.
The Debt Problem Grows
Fast growth comes with financial strain. CoreWeave spent $1.9 billion on capital expenditures in Q3 alone.
Another $6.9 billion sits in “construction in progress” waiting to be deployed. Operating cash flow hit $1.5 billion through nine months of 2025.
Even with Nvidia’s $2 billion, CoreWeave needs to borrow heavily. The debt burden is already showing up in the numbers.
Interest expenses reached $841.4 million in the first nine months of 2025. That’s four times higher than the same period in 2024.
Operating income collapsed to just $43.6 million from $211.7 million in the prior year. Interest and depreciation costs are crushing profitability as the company scales.
Execution Risks Remain
Construction delays pose real threats to revenue. CoreWeave can only rent capacity it’s actually built.
A developer experienced setbacks after Q3, raising questions about the 2030 timeline. Any slowdown in buildout directly impacts the bottom line.
The stock trades at $93.19 with a $46 billion market cap. The 52-week range spans $33.52 to $187.00.
CoreWeave’s gross margin sits at 49.23%. But turning that into net profit remains a challenge with debt costs eating away at earnings.
Nvidia’s cash infusion provides breathing room. The company’s $77 billion in trailing twelve-month free cash flow means it can afford to keep backing CoreWeave.
The investment values CoreWeave higher than recent market prices, sending shares up on the news.
The post Is CoreWeave (CRWV) Stock a Buy After Nvidia’s Latest Move? appeared first on Blockonomi.
Source: https://blockonomi.com/is-coreweave-crwv-stock-a-buy-after-nvidias-latest-move/