CoreWeave's IPO Debut: Shares Priced at $40, Raising $1.5 Billion

CoreWeave, a cloud computing firm specializing in artificial intelligence infrastructure, has launched its initial public offering at $40 per share, securing $1.5 billion in capital. This pricing falls below the initially projected range of $47 to $55 per share, reflecting a tempered market response amid current stock market volatility.

The company adjusted its offering, reducing the number of shares from the anticipated 49 million to 37.5 million. This move values CoreWeave at approximately $19 billion, or $23 billion on a fully diluted basis. The decision to downsize follows concerns about a potential AI market bubble and a broader downturn in tech valuations.

Nvidia, a leading AI chip manufacturer and significant backer of CoreWeave, has reinforced its support by placing a $250 million order in the IPO. This investment underscores Nvidia's commitment to the AI cloud services sector and its confidence in CoreWeave's strategic direction.

Founded in 2017 as a cryptocurrency mining operation, CoreWeave pivoted to AI-focused cloud infrastructure, leveraging Nvidia's graphics processing units to power complex workloads. The company reported a remarkable revenue surge, reaching $1.9 billion in 2024, an eightfold increase from the previous year. However, this growth is accompanied by financial challenges, including an $8 billion debt load and a net loss of $863 million in 2024, attributed to substantial investments in business expansion.

A significant portion of CoreWeave's revenue—62%—is derived from its partnership with Microsoft, highlighting a reliance on key clients. Additionally, CoreWeave secured a deal worth up to $11.9 billion to provide AI infrastructure to OpenAI, further cementing its position in the AI ecosystem.