CoreWeave's earnings signal a turnaround for the stock, but analysts say it will take time
CoreWeave’s closely watched third-quarter financial report included stronger-than-expected revenue and a narrower-than-estimated loss. Investors welcomed the report, while analysts on Wall Street weren’t changing their outlooks on the stock too much. The cloud infrastructure technology company popped 13% in premarket trading on Wednesday, giving some relief to a stock that is off almost 65% from its 52-week high. Shares have been battered on concerns that artificial intelligence companies — including CoreWeave — were borrowing too much money for their build-outs. “You could almost hear the sigh of relief in the AI market as CRWV posted a solid results that extended the margin story that took hold last quarter,” JPMorgan credit analyst Thomas Egan wrote in a Wednesday note. “This time, management paired the profitability inflection with a more detailed capital plan that directly addresses the funding and cost-of-capital concerns that have recently challenged the credit .” CRWV YTD mountain CoreWeave year-to-date. In the lead-up to the report, CoreWeave’s five-year credit default swaps blew past their October highs, signaling investors viewed the debt as increasingly risky. Barclays analyst Raimo Lenschow wrote in a Tuesday note that the earnings report will likely calm investors’ credit-related nerves, as revenue growth accelerated to 168% year over year. But many Wall Street analysts didn’t alter their ratings or price targets after the report. UBS said Wednesday’s rally may not be enough for CoreWeave to regain investors’ confidence. “Restoring confidence may be a multi-quarter fix and we still believe this,” wrote UBS analyst Karl Keirstead in a Tuesday note. “We’re encouraged by this print, but investors need more confidence in the underlying economics of the business.” But Bernstein’s Madison Rezaei was less convinced by the report. While she acknowledged that it represented growing maturity for the company, she said the company’s fundamentals are shaky. “Execution keeps improving,” she wrote in a Tuesday note. “The fundamentals remain the overhang.” Deutsche Bank: Buy rating, $125 price target “We think they delivered on multiple fronts. First, CoreWeave continued to build it strack record of consistent execution in an environment where less experienced AI Cloud providers are experiencing growing pains as they begin to scale, which helped drive record quarterly revenue outperformance and pulled forward the inflection in NGOM. Second, the demand backdrop remains robust, supporting another quarter of sequentially higher prices, contribution margins and strategic choice regarding the customers to which CoreWeave allocates capacity. Improving unit economics and scale are expected to enable EBITDA less interest expense to more than double y/y in CY27 and the company to reach non-GAAP EPS profitability in CY28.” Morgan Stanley: Equal weight, $70 “We acknowledge that CoreWeave delivered a strong Q3 across both top line and margins as continued strong demand and pricing benefited. The management team also did a good job of seeking to reassure the market on the 2027 financing bridge. We come away incrementally more positive on the 2027 financing bridge but, that said, we prefer to maintain a balanced view until we see the new DDTL complete in the current environment.” Barclays: Equal weight, $105 “We see CRWV shares higher in the short term. Following several weeks of CRWV being under pressure due to funding questions, we see healthy Q3 results and FY guide increases as good enough to calm investors on the story again.” Bank of America: Buy, $140 “CoreWeave’s funding needs are manageable, in our view, supported by a diversified set of financing options. While the company does not expect to access the unsecured market through 2027, CoreWeave can fund incremental capex through customer prepayments, which have been included in 70% of deals signed this year and should become more prevalent, as well as vendor financing and contract-backed DDTLs.” UBS: Buy, $105 “On all the hot-button topics (credit access/cost, capacity hurdles, core revs and profitability), the messaging was positive. If one were to poke any holes in the print, it might be that a) the capacity added in 3Q26 (200 MW) was 50 MW shy of our estimate and b) the unsecured debt markets are not attractive right now (limiting the funding pools).” Bernstein: Underperform, $54 “We want to be believers, especially with the stock off 65% from its May high. If we were sitting in Intrator’s chair, we’d make many of the same calls, and we congratulate the CRWV team on the trajectory. But we just can’t get over our long-term fundamental concerns about this business model.” Goldman Sachs: Buy, $106 “We would add to positions with the stock near YTD lows, as we believe CoreWeave’s technology differentiation and ability to scale up capex, coupled with favorable contract economics, can drive outsized equity returns over the next 12 months.” Citi: Buy, $128 “Overall, the results show CoreWeave continues to execute on the controllables and support our view that the AI compute demand environment remains unquestionably strong. We believe increased evidence of demand durability can help alleviate higher financing costs.” JPMorgan: Overweight, $125 “The results and outlined plans further amplify our confidence in the health of the fundamental drivers of the business, even before considering the premium likely to be associated with CoreWeave’s capacity amidst the capacity ramp challenges faced by the competitors, and the limited capacity concentration risk associated with the company relative to competition.”
