With all eyes on Nvidia’s (NVDA) first-quarter earnings, one under-the-radar AI stock has already gained momentum, surging 30% in the past five days.
That company is CoreWeave, now Nvidia’s largest holding, making up more than 78% of the AI chipmaker’s disclosed portfolio.
CoreWeave Inc. (CRWV) is a cloud infrastructure company specializing in GPU-accelerated computing for artificial intelligence and machine learning workloads. Founded in 2017, the company transitioned from cryptocurrency mining to providing AI-focused cloud services.
Now, the company is quietly delivering explosive growth and winning support from Nvidia and OpenAI just weeks after its IPO.
On March 28, CoreWeave launched its initial public offering, pricing shares at $40 each, below its anticipated range of $47 to $55. Still, the IPO raised $1.5 billion, making it one of the largest AI-related listings since 2021. Since then, the stock is up more than 200%.
Nvidia holds approximately a 7% stake in CoreWeave.
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CoreWeave posts 420% revenue growth
CoreWeave’s data centers are equipped with Nvidia GPUs, and Nvidia holds approximately a 7% stake in the company.
The chip giant has invested in CoreWeave since April 2023, before it went public. In the first quarter of this year, Nvidia bought 24,182,460 shares following the IPO, according to WhaleWisdom data based on 13F filings.
Related: Analysts issue rare warning on Nvidia stock before key earnings
On May 14, CoreWeave posted its first earnings since going public, with a 420% year-over-year revenue increase to $981.6 million for the first quarter. This growth might remind investors of Nvidia’s explosive performance during the AI boom of 2023 and 2024.
“Demand for our platform is robust and accelerating as AI leaders seek the highly performant AI cloud infrastructure required for the most advanced applications,” Chief Executive Michael Intrator said in a statement.
CoreWeave’s net loss for the quarter widened to $314.6 million from $129.2 million a year earlier, partly due to $177 million in stock-based compensation tied to the IPO.
The company expects revenue of $4.9 billion to $5.1 billion in 2025, up 363% year-over-year and above Wall Street estimates. It also projects capital expenditures of $20 billion to $23 billion for the year.
In the first quarter, OpenAI signed a five-year deal with CoreWeave worth up to $11.9 billion. After the quarter ended, the two companies signed an additional $4 billion contract, Intrator told CNBC.
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Nvidia’s investment portfolio includes Arm Holdings (ARM) , Applied Digital (APLD) , Recursion Pharmaceuticals (RXRX) , Yandex (YNDX) , and WeRide (WRD) .
Nvidia’s backing could send a stock soaring, but it doesn’t always last.
In early 2024, Nvidia disclosed a stake in SoundHound AI (SOUN) , sending shares soaring 567% that year. But by February 2025, Nvidia revealed it had sold out completely. SoundHound shares have fallen 46% year to date.
Barclays downgrades CoreWeave stock, lifts price target
Barclays analyst Raimo Lenschow downgraded CoreWeave to equal weight from overweight, but raised the price target to $100, up from $70, thefly.com reported.
Barclays continues to like the role Coreweave is playing in the new generative AI world. However, after a sharp rally since the IPO, the analyst is concerned about the stock’s current valuation, saying it “could be stretched to move higher off fundamentals in the near term.”
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The “issue investors now face with this next-gen high growth tech asset is to ascribe an appropriate valuation to the name, especially with there being no close comparable peer group that can be used,” the analyst said in a research note.
CoreWeave stock traded at around $117.5 on May 28, meaning Barclays’ $100 price target sits below current levels. Meanwhile, data from TipRanks shows an average target of $47.42, implying a potential 60% downside risk.
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