CoreWeave expects to achieve adjusted profitability in the first half of 2028 and sees no reason for its partnership with Nvidia to change. The AI cloud provider also outlined a financing strategy to support its rapid expansion and address concerns over its growing debt burden, while saying shifts in the U.S. political landscape are not expected to materially affect its data-center buildout or existing customer commitments.
CoreWeave Targets Adjusted Profitability in 2028
CoreWeave expects to achieve adjusted profitability in the first half of 2028, offering investors a longer-term timeline for when its substantial investments in AI infrastructure could begin generating sustainable returns.
The company's third-quarter results showed strong demand for AI computing capacity. Revenue surged 168% year over year to $3.66 billion, beating analysts' estimates of $3.55 billion, according to LSEG data. Its adjusted loss per share was 95 cents, narrower than analysts' estimates for a loss of $1.16, according to Reuters.
CoreWeave also raised its full-year 2026 revenue forecast to between $13 billion and $13.3 billion, from a previous range of $12.4 billion to $13.2 billion.
Its revenue backlog reached $132.5 billion at the end of September, up from $104 billion at the end of June. The company said demand for its computing capacity was roughly 10 times the amount currently available, with much of its capacity already committed through next year.
CoreWeave Sees No Reason for Nvidia Partnership to Change
CoreWeave CEO Michael Intrator said there was no reason for the company's partnership with Nvidia to change, describing the chipmaker as a great partner, Bloomberg reported on Wednesday.
Intrator said the two companies have maintained close collaboration, with CoreWeave working with hundreds and even thousands of Nvidia employees. He declined to comment on an independent investigation being conducted by Nvidia's board.
The partnership remains central to CoreWeave's business. Nvidia is both a major technology partner and an investor in the AI cloud company, while CoreWeave relies on Nvidia's AI hardware to build out its computing infrastructure.
New Financing Strategy Aims to Ease Debt Concerns
Alongside its earnings results, CoreWeave outlined a financing strategy designed to support its rapid expansion while reducing its reliance on expensive borrowing.
The company said it would not tap the unsecured debt market at current yields, instead relying primarily on loans backed by customer contracts, operating cash flow and customer prepayments. It expects to raise less than $5 billion in additional capital through 2027.
As part of its third-quarter financing activities, CoreWeave raised approximately $4.2 billion through an upsized offering of convertible senior notes and closed a $2.6 billion delayed-draw term loan facility. It also established its first at-the-market equity offering program, authorizing the sale of up to 35 million shares of Class A common stock.
A key part of its financing strategy is the use of delayed-draw term loans tied to specific customer contracts. Under this arrangement, CoreWeave can draw financing as equipment is purchased and delivered, with loans generally covering 70% to 100% of the associated capital expenditure. Cash flows generated by the customer contracts are then used to pay interest and repay principal.
CoreWeave said it had already paid down more than $4 billion in debt through this mechanism. Once the underlying customer contracts expire and the related financing is repaid, the company retains ownership of the infrastructure, which can continue generating revenue.
Customer prepayments are another important funding source. CoreWeave expects to receive approximately $9 billion in prepayments and deposits over the next three months. The company is also using original equipment manufacturer financing to support additional deployments. Management said these funding sources are expected to cover the significant majority of its capital requirements through 2027.
The financing strategy comes as CoreWeave faces concerns over its substantial investment requirements. Capital expenditure rose to $14.5 billion in the third quarter from $9.4 billion in the previous quarter, while total debt stood at approximately $46.9 billion at the end of September.
CoreWeave expects to spend between $37 billion and $39 billion in 2026 as it accelerates data-center construction. Its shares had fallen sharply amid concerns about debt-funded AI infrastructure investment, but rose about 5% in extended trading following the earnings announcement.
CoreWeave Expects No Material Impact from Political Shifts
The changing U.S. political landscape has raised concerns about potential regulatory hurdles for AI data-center expansion following Democrats' strong performance in the midterm elections. Investors have worried that increased scrutiny of data-center construction, particularly over electricity costs and water consumption, could delay projects and affect companies such as CoreWeave.
Intrator acknowledged that data-center developers would face greater scrutiny over construction practices and resource use. However, he told Reuters that he did not expect the changes to require a material shift in how CoreWeave builds its infrastructure or significantly increase construction costs.
He also noted that projects could take longer as companies become more transparent and work through the process with local communities. Intrator said this approach was already part of CoreWeave's data-center development practices.
Separately, Intrator said in a LinkedIn post that the company did not anticipate any impact on its existing customer commitments or associated backlog as a result of shifts in the political landscape.
"We look forward to continuing to work with elected leaders from both parties, at every level of government, to strengthen American competitiveness, support our communities, and build the foundation for the next generation of breakthroughs," Intrator said.
CoreWeave has also been expanding internationally. More than 1.3 gigawatts of its 4.6 gigawatts in contracted power is located outside the United States, spanning Canada, Europe and Asia. The company entered new markets including Indonesia and India in the third quarter while expanding its footprint in Denmark and Spain. Intrator said the international expansion strategy had been underway for about 18 months and was not a response to the election results.
Comments