TLDR
- CoreWeave stock rose 12% Tuesday after announcing a $14.2 billion Meta cloud computing contract through 2031
- The company secured $42 billion in total contracts recently, including $6.3 billion from Nvidia and $22.4 billion from OpenAI
- Shares have climbed 63% in three weeks after falling 55% during summer
- Q2 revenue jumped 105% to $1.21 billion but the company reported a $290.5 million loss
- CoreWeave rents GPU computing power to AI companies through cloud infrastructure
CoreWeave stock surged 12% Tuesday after the company confirmed a $14.2 billion cloud computing deal with Meta Platforms. The contract runs through December 2031 with an option to extend into 2032.
The Meta agreement provides guaranteed cloud capacity access. It marks another major client win for the GPU infrastructure provider.
CoreWeave shares have now gained 63% over three weeks. The rally comes after a brutal summer that saw the stock drop 55% from June highs.
Three Megadeals in Three Weeks
The Meta partnership follows two other major announcements this month. CoreWeave signed a $6.3 billion agreement with Nvidia earlier in September.
That deal guarantees Nvidia will purchase any unsold cloud capacity through April 2032. It creates a revenue backstop during periods of lower demand.
Last week, CoreWeave expanded its OpenAI contract by $6.5 billion. The total OpenAI agreement now stands at $22.4 billion.
The new capacity will support training for OpenAI’s next-generation AI models. Combined, CoreWeave has announced over $42 billion in contracts in recent weeks.
The company was founded in 2017. The rapid growth has made it one of the fastest-rising names in AI infrastructure.
Strong Revenue Growth With Heavy Spending
CoreWeave reported Q2 revenue of $1.21 billion. That represents 105% year-over-year growth.
The company’s order backlog sits at $30.1 billion. Major customers include OpenAI, Microsoft, and now Meta.
However, scaling operations has proven expensive. CoreWeave posted a $290.5 million net loss in Q2.
Capital expenditures reached $2.9 billion during the quarter. The company plans to spend $20 billion to $23 billion annually on infrastructure buildout.
CoreWeave specializes in GPU-as-a-service. The business model involves renting high-performance graphics chips through cloud infrastructure.
This allows AI companies to access computing power without building their own data centers. CoreWeave positions itself as critical infrastructure for AI development.
Recovery From Summer Lows
The stock hit lows of $84.50 in early September. Shares now trade above $142.
CoreWeave needs to break through its August high of $150 to confirm full recovery. The next technical target sits near $186, the June peak.
The Meta deal gives Meta access to Nvidia’s latest GB300 systems. Meta has not publicly commented on the partnership.
The Nvidia backstop agreement provides financial stability during demand fluctuations. It strengthens CoreWeave’s relationship with a leading chip supplier.
CoreWeave stock remains volatile. Traders have embraced the growth story despite the bumpy price action and questions about profitability timing.
