Why I Am Falling In Love With Coreweave

I have to admit it. I cannot tell a lie. I can, but I am not going to. My beloved Palantir has a rival in my affections. The more I see of Coreweave, the more I am smitten. What a stunningly exciting business. Forget Atlantic Computers. There is no comparison. One was paste; the other is a diamond. Although bizarrely, Coreweave started life as Atlantic Crypto.

The rate at which Coreweave is growing is just mind-blowing.

This would be incredible growth if each bar were a year, but they are quarters! Investors look at numbers like this and think this is unsustainable, and no doubt it is, but it is a hell of a start and indicative of a company on a growth track of staggering power.

I had not realised until recently that Coreweave, which was only founded in 2017, began as a Bitcoin miner. This meant it needed loads of Nvidia GPUs and great computing skills. It echoes Nvidia’s period supplying GPUs to the crypto mining industry.

Just like Nvidia, Coreweave realised that its skills were perfect for the emerging demand for AI infrastructure. In 2019, it began to address this new market. This raises a key point about why Coreweave might be an especially exciting share. It is virtually a start-up. Investors are buying shares in this company early in its journey.

Really successful companies, the Googles and Facebooks, often hit the ground running and become huge in the blink of an eye. Coreweave looks the same, with 2025 turnover projected to exceed $5bn. Talk about zero to hero; that is fantastic growth for a business, which has existed in its current form for less than six years.

Something else is going on. The company has just raised $2bn with an issue of senior notes, i.e. debt. The company was looking for $1.5bn, but with the issue five times oversubscribed, it raised more.

This is purely my speculation, but I wonder if the company has decided to keep its equity scarce. Coreweave builds state-of-the-art data centres that it rents to clients on long-term contracts, infrastructure as a service (IaaS), as it calls it. This creates a stream of high-quality income but requires massive upfront investment.

Investors may have worried that Coreweave would need big share issues to grow, diluting existing shareholders, but strong demand for the group’s debt alleviates this risk. It resembles Strategy’s strategy of issuing debt to buy Bitcoin, except that Coreweave is buying income rather than assets. Furthermore, the assets may not depreciate as fast as I thought because earlier generation GPUs are still fabulously powerful and can handle less demanding workloads.

The other point is the size of the addressable market. In a world of GenAI demand for data and more powerful computers to process that data is almost infinite. This process of crunching data in lightning-fast computers creates intelligence, what Nvidia’s Jensen Huang calls tokens. These tokens are valuable, much more valuable than the cost of generating them, even with Nvidia’s pricy GPUs.

This leads to two conclusions. First, the demand for AI-suitable data centres is virtually infinite because they are not data centres anymore, they are what Huang calls AI factories, data in, valuable tokens out. Second, companies, even mega caps, need all the help they can to bring these AI factories on stream in terms of hardware, software, access to GPUs, power to run them, using liquid cooling to deal with the heat generated (fans don’t cut it) and much else.

This is where Coreweave’s specialist expertise comes into play. It is an outsourcing play. Let Coreweave handle all the nitty-gritty of bringing those AI factories on stream, including owning them and the customers, hyperscalers, governments and others, can focus on cashing in on those super valuable tokens to transform their and others’ enterprises.

Demand is especially insane because the existing infrastructure is not fit for purpose, having been built for the Internet, web hosting, videos, and the old cloud. It is as though humanity is going from reaching for the planets to reaching for the stars. Coreweave stands at the heart of this process and is so closely linked with Nvidia that the latter has a seven per cent stake.

Oracle talks about having hundreds of data centres, aka AI factories, but wanting 1000s. We are arguably an early stage in the most incredible transformation humanity has ever experienced. And Coreweave is not just a clever financier. It’s a highly innovative technology business.

It is also, because of that lucky chance of starting life as a Bitcoin mining technology business, well placed to secure that first mover advantage that time and again has proved so significant for technology-related businesses.

Analysts often look at businesses like Coreweave from the wrong end of the telescope. They ask what could go wrong. I ask what could go right. I also ask myself if I shouldn’t just listen to what the founders are saying.

We are just getting started and demand for our platform is robust and accelerating. In particular, we are excited to see the broad-based increase in demand for inference as well as the accelerating adoption of AI by our enterprise customers. AI growth and adoption remains severely limited by capacity constraints. CoreWeave is scaling as fast as it can to meet the demands of our customers.

Michael Intrator, cofounder & CEO, Coreweave, Q1 2025, 14 May 2025

Coreweave is a special business.

CoreWeave is powering AI innovation at scale. Our cloud platform is purposebuilt for AI workloads, delivering Infrastructure-as-a-Service with highly differentiated cloud software and services on top. Yesterday’s general-purpose cloud infrastructure, which is still used to power much of the digital world, was not built to support the scale and complexity of artificial intelligence. These clouds were built to host websites and run SaaS applications, not to run high-performance training and inference workloads. The exponential growth and success of our customers’ AI products are driving demand for our differentiated services. With a deep understanding of AI customers and workloads, our cloud platform has been architected to optimize for the needs of AI at every layer. As inferences become more compute-intensive, the ability to run both research and production workloads on the same infrastructure provides our customers with the flexibility to optimize their total cost of ownership. Our cloud software and infrastructure services abstract away the complexity of running infrastructure at massive scale and are significantly differentiated in the market. We believe that CoreWeave does this better than anyone else, and industry experts agree. In March, SemiAnalysis awarded CoreWeave its highest rating, Platinum based on its ClusterMAX rating system. We were the only cloud provider to receive this rating. SemiAnalysis highlighted our industry-leading leadership in operating large-scale 10,000-plus H100 clusters with high reliability. We are proud that we were rated above the established hyperscalers as well as the NEO GPU clouds. Why is all of this important? AI is the greatest technological revolution of our lifetime, and we believe that the company can create tremendous shareholder value by growing its leadership position.

Michael Intrator, cofounder & CEO, Coreweave, Q1 2025, 14 May 2025

The physical scale of what is happening at Coreweave is amazing.

Today, we benefit from a network of 33 purpose-built AI data centers across the US and Europe, supported by 420 megawatts of active power. Our total contracted power extends to approximately 1.6 gigawatts, providing us with a durable multiyear runway in power capacity. CoreWeave operates at the leading edge of technology, ensuring we deliver superior performance and efficiency to our customers every day. The world’s most sophisticated AI leaders understand the power of our platform. This has enabled CoreWeave to grow at an unprecedented rate. Today, we serve the most important AI companies in the world. And with Weights & Biases acquisition, we welcomed nearly 1,400 more AI labs and enterprises as customers. We see immense growth opportunity in our future. AI is expected to have a cumulative global economic impact of $20 trillion by 2030. The total addressable market is expected to grow to $400 billion by 2028. To seize this opportunity and to serve more customers, CoreWeave has led the way in developing innovative financial mechanism to expand our platform.

Michael Intrator, cofounder & CEO, Coreweave, Q1 2025, 14 May 2025

The company has grown so fast that in 2022 it owned and operated just three data centres versus 33 in 2025. Growth at this pace has required the company to scale up its operations dramatically and learn fast.

Additionally, and importantly, for companies scaling at our pace, CoreWeave is already profitable and on an adjusted operating income basis. Our business model features strong revenue visibility and attractive sustainable unit economics. We continue to focus on four key areas. This includes scaling our capacity, financing our infrastructure, further differentiating our platform and expanding our go-to-market capabilities. I will focus on each of these areas. First, scaling CoreWeave’s capacity. In Q1, we added approximately 300 megawatts of incremental contracted power to our portfolio. In order to efficiently scale our capacity, we will work to secure the power resources necessary to expand our data center footprint and deploy industry-leading next generation compute to serve the requirements of the industry. Second, financing our infrastructure. Our capital expenditures are success-based. Substantially, we enter into compute CapEx programs when we sign multiyear contracted revenue that more than covers the cost of the CapEx within the contract terms. This enables us to responsibly scale our debt structures that support this contractual revenue and utilize naturally deleveraging self-amortizing debt facilities that allow for us to maintain relatively low leverage multiples. Third, differentiating our platform. Our rapid adoption and scaling of leading-edge technology is central to our competitive advantage. After being the first to deliver NVIDIA’s H100s and H200 GPUs at scale, we were the first to make NVIDIA’s GB200 NVL72 instances generally available and begin ramping Blackwell revenue in the first quarter. Our superior performance, better scalability and time to market provides our customers with a competitive advantage to capture new AI opportunities. We also recently announced that our MLPerf Inference v5.0 results set a new industry benchmark with NVIDIA’s GB200 Grace Blackwell Superchips. As we continue to build our infrastructure and software differentiation, we released our next-generation CoreWeave AI Object Storage, purpose-built for the most demanding training and inference use cases. Pairing
CoreWeave AI Object Storage with CoreWeave’s Kubernetes services provides the most demanding AI customers with an out-of-the-box experience that is production-ready on day 1.

In the quarter, we also announced support for NVIDIA’s AI enterprise software and NVIDIA’s Cloud Functions, NVCF, as we continue to enable ecosystem solutions on our platform. Fourth, expanding CoreWeave’s go-to- market capabilities. There is enormous growing demand for advanced AI infrastructure. In addition to the enterprises and labs that we serve. CoreWeave has recently expanded its global footprint. This has enabled the company to expand its offerings in new markets, growing our business with current customers while reaching new ones.

Yesterday, we announced the opening of a new data center in Spain in partnership with MERLIN Edged with Mistral AI as our anchor client. As demand for AI infrastructure continues to aggressively grow, CoreWeave will succeed based on its ability to execute and solve the world’s most demanding AI infrastructure challenges. Today, we have grown our team to about 1,400, including some of the most accomplished and talented in the AI space.

Michael Intrator, cofounder & CEO, Coreweave, Q1 2025, 14 May 2025

Share Recommendations

Coreweave. CRWV

Strategy – Start A Buying Programme With Coreweave

My speciality is picking shares that go on to become huge winners. I have a growing feeling that I have found one in Coreweave. It feels super exciting and is growing at the most insane pace. I was trying to find out how many employees they had in the past. As recently as 2024, they had 525 employees. The number will soon have tripled from that level, including many high-level appointments, as Coreweave becomes a magnet for top technology talent.

High rewards come with high risks. Mainly, what you have to do here is believe what management is saying and observe how effectively they are walking the talk. The company has seized a moment in time to position itself at the heart of the most exciting technological transformation in human history. My conclusion is that they COULD become a very large business, perhaps quite quickly and if they can fund their progress through debt-type issues and cash flow, keeping the shares scarce, the upside could be dramatic.

Something else occurs to me. Coreweave is scaling so fast that the only companies that could compete are the hyperscalers, who are already big customers. These giant companies are jacks of all trades, but Coreweave is focused on one thing: delivering state-of-the-art data centres/ AI factories and doing that one thing superlatively well.

Hyperscalers may also be just the beginning as the company starts to broaden its currently narrow customer base, and the global opportunity must be huge as Coreweave becomes a centre of expertise, perhaps THE centre of expertise in building AI factories of unimaginable speed and power.