CoreWeave & Nvidia

CoreWeave is having its day in the sun, its shares surged 29% in the past week after smashing expectations in its first quarterly results as a public company. Revenue hit $982 million, up 420% year-on-year, and a new $4 billion deal with OpenAI added to an already massive $12 billion contract.

CoreWeave is an AI-first cloud infrastructure firm. Think of it as a specialist landlord, renting out access to over 250 000 high-end Nvidia GPUs, tailored for AI workloads like training large language models. Even giants like Microsoft, Nvidia, and OpenAI rely on them when internal data center capacity runs thin.

A close partnership with Nvidia (which now owns a $2 billion stake) helped seal the company's position at the heart of the AI compute gold rush. CoreWeave is heavily reliant on Nvidia (100% of its chips) and Microsoft (62% of revenue).

It's carrying $8 billion in debt and expects to spend over $20 billion in capex this year. The assets backing that debt, namely, servers and chips, could depreciate quickly in this fast-moving space. Yet the CEO says bookings already exceed $29 billion, enough to cover debt and future investment. High risk, high reward.