CoreWeave, a prominent cloud computing provider recognized for offering Nvidia GPUs to leading companies like Meta and Microsoft, has officially filed for an initial public offering (IPO) on Nasdaq using the ticker symbol CRWV.
According to a report from CNBC, CoreWeave experienced a remarkable 700% surge in revenue in 2024, reaching $1.92 billion. However, the company reported a net loss of $863.4 million in its IPO filing. The substantial growth of CoreWeave can be attributed to contracts valued at over $15 billion, with a significant portion of its revenue (77%) coming from just two customers, Microsoft being the primary contributor at 62%.
In Q4 of 2024, CoreWeave generated $747.4 million in revenue with an impressive gross margin of 76%. Despite an operating income of $112.7 million, the company reported a net loss of $51.4 million mainly due to interest expenses. By the end of the year, CoreWeave’s debt had accumulated to nearly $8 billion.
The company’s journey began in 2017 as Atlantic Crypto, focusing initially on Ethereum mining infrastructure. As the cryptocurrency market fluctuated, CoreWeave pivoted its business model towards AI and cloud computing, acquiring more GPUs and rebranding as CoreWeave to cater to the increasing demand for high-performance computing.
CEO Michael Intrator, holding 38% of voting power, explained the transition in a blog post in 2021, highlighting the challenges faced by businesses relying on GPU acceleration from traditional cloud providers. CoreWeave aimed to deliver more scalable and cost-effective solutions to attract AI developers and cloud computing clients.
By the end of 2024, CoreWeave is set to operate 32 data centers housing over 250,000 Nvidia GPUs, predominantly running on Nvidia’s Hopper architecture. The company has also secured contracts for 1.3 gigawatts of power to support its infrastructure, with 360 megawatts currently in use.
CoreWeave made significant strides in AI infrastructure following OpenAI’s launch of ChatGPT in late 2022, leading to a partnership with Microsoft in 2023 to address OpenAI’s computing requirements. Microsoft CEO Satya Nadella acknowledged the surge in AI demand, emphasizing the need to adapt to the changing landscape.
Despite Microsoft being CoreWeave’s primary customer, it also faces competition from tech giants like Amazon, Google, and Oracle, along with smaller players in the cloud computing and AI infrastructure market.
To enhance its AI cloud offerings, CoreWeave is in the process of acquiring Weights & Biases, a platform widely used by AI researchers, for $1.7 billion. This strategic move aims to integrate CoreWeave’s cloud computing infrastructure with Weights & Biases’ development tools for a seamless experience for AI developers.
As CoreWeave prepares for its IPO, potential challenges lie in the current market conditions, with the tech IPO landscape experiencing a slowdown. The company’s reliance on Nvidia GPUs manufactured by TSMC poses a risk in case of geopolitical tensions affecting the supply chain.
Overall, CoreWeave’s journey from crypto mining to AI infrastructure showcases its commitment to innovation and meeting the evolving demands of the industry.
