CoreWeave shares surged 22% on Friday after Citigroup analysts initiated coverage with a buy rating and $192 price target, according to multiple financial reports. The AI infrastructure company's stock (NASDAQ: CRWV) closed at approximately $83 per share following the rally, which comes after months of negative pressure that drove shares down 60% from mid-2025 highs.
The neocloud provider rents dedicated AI data centers powered by Nvidia graphics processing units to customers including Meta Platforms, Microsoft, OpenAI, and Google. CoreWeave reported third-quarter revenue of $1.365 billion, representing 134% year-over-year growth, though this marked a deceleration from 207% growth in the second quarter.
CoreWeave's revenue backlog reached $55.6 billion as of September 30, up from $30.1 billion just three months earlier, according to company filings. The company generated $3.6 billion in revenue during the first three quarters of 2025, compared to $1.17 billion in the same period last year.
Despite strong top-line growth, CoreWeave posted a third-quarter net loss of $110.1 million despite $51.9 million in operating income. Interest expense totaled $310.6 million for the quarter, up from $104.4 million in the year-ago period as the company takes on debt to finance expansion.
The AI infrastructure specialist reported $1.9 billion in capital expenditures during the third quarter alone and guided to $12-14 billion for full-year 2025. CoreWeave has secured $14 billion in debt and equity transactions year-to-date to fund its aggressive capacity buildout.
CoreWeave ended the third quarter with 590 megawatts of active data center capacity, up 120 megawatts from the previous quarter. Management anticipates bringing at least 1 gigawatt of active capacity online within the next 12 to 24 months, which would represent a quarterly addition of approximately 125 megawatts.
The company recently announced participation in the Energy Department's Genesis Mission, an initiative to accelerate scientific research, national security, and energy innovation through AI and supercomputing. This provides access to public sector workloads and aligns with CoreWeave's expansion into government services via its Federal unit.
CoreWeave went public in March at $40 per share, with the stock soaring to a peak around $187 before recent declines. A $5,000 investment at the IPO price would have purchased 125 shares, now worth approximately $10,500 following Friday's surge - a 110% gain in under nine months.
Analysts expect CoreWeave's revenue to more than double in 2026, with the company projected to generate over $12 billion next year based on its massive backlog. The median 12-month price target among 33 analysts covering the stock stands at $122, suggesting 76% upside from current levels.
Citi analyst Tyler Radke resumed coverage with a Buy/High Risk rating, citing strong underlying demand, with some potential demand redirected to other providers due to capacity limits. The analyst noted the company's self-build and joint-venture model for faster deployment while retaining control, and efforts to reduce capital costs.
CoreWeave faces execution risks including data center construction delays, high-interest debt financing, and customer concentration. The company relies heavily on major clients like Microsoft and OpenAI while competing with hyperscalers building in-house capacity.
The AI infrastructure provider operates in what it describes as a "highly supply-constrained environment where demand for CoreWeave's best-in-class AI cloud platform far exceeds available capacity." This favorable demand-supply dynamic should ensure new capacity is quickly absorbed by customers.
With shares trading at a price-to-sales ratio of nearly 10 despite ongoing net losses and soaring interest expenses, valuation remains a concern for some investors. The company's aggressive expansion comes as the broader tech sector has rallied, with the Nasdaq Composite gaining 32% since April and 20% year-to-date.
Market strategist Ryan Detrick of Carson Group notes that bull markets historically stretch an average of eight years once they reach three years old, suggesting continued strength in 2026. The S&P 500's bull market turned three years old earlier this year, supporting the case for ongoing tech sector momentum.
CoreWeave's challenge remains converting massive demand into sustainable profits while managing capital-intensive expansion. The company must bring new data center sites online on schedule, fill them with contracted demand, and control capital costs as it scales to meet its $55.6 billion backlog.
