CoreWeave Opts for Smaller IPO Amid Market Challenges

NEW YORK, March 27, 2025 — CoreWeave, an AI infrastructure provider backed by Nvidia, plans to reduce the size of its U.S. initial public offering (IPO) and price its shares below the originally indicated range. The company aims to sell 37.5 million shares at $40 each, down from a targeted pricing of between $47 and $55 per share.

The IPO is expected to raise approximately $1.5 billion, valuing CoreWeave at around $23 billion on a fully diluted basis, according to sources familiar with the matter. Nvidia is anchoring the offering with a $250 million order.

CoreWeave’s IPO comes during a volatile period for the market, marked by decreased investor appetite for risky assets. The latest downturn in initial public offerings (IPOs) highlights a broader trend, with total U.S.-listed equity capital market deals dropping to 187 so far in 2025, a decrease from 243 in the same timeframe last year.

A person who requested anonymity revealed that CoreWeave’s roadshow received a lukewarm response, hindering the company’s ability to secure the originally planned valuation. Investor concerns have centered around the company’s reliance on partnerships with major tech players, particularly Microsoft, as well as its capital-intensive business model.

“While the business model doesn’t appear fundamentally flawed, there are signs investors are recalibrating AI infrastructure valuations,” said Lukas Muehlbauer, a research analyst at IPOX.

Founded in 2017 as Atlantic Crypto, CoreWeave initially provided infrastructure for cryptocurrency mining. Following a drop in digital currency prices, it pivoted to focus on AI, acquiring significant numbers of graphics processing units (GPUs), mainly from Nvidia. As per its offering documents, CoreWeave reported a revenue increase of over 700%, projecting $1.92 billion for 2024, though it also recorded a net loss of $863.4 million.

The prospectus noted that 77% of its revenue originates from two major clients, with Nvidia accounting for 62%. Additionally, the company ended 2024 with over 250,000 Nvidia GPUs deployed across its 32 data centers.

Despite the significant backing and partnerships, CoreWeave’s path to profitability remains uncertain. Last year, it reported approximately $8 billion in debt and relies on operating leases for much of its data center infrastructure, with liabilities totaling around $2.6 billion.

The company plans to use about $1 billion of the IPO proceeds to pay down its debt, but it has indicated intentions to continue borrowing, raising red flags for potential investors.

Amid rising competition from entities such as DeepSeek, a Chinese AI competitor, CoreWeave’s listing has raised questions about the sustainability of data center investments and the overall confidence in the tech sector amidst a backdrop of high inflation and interest rates.

Should the IPO succeed, it could serve as a bellwether for the AI infrastructure market and a critical test of investor sentiment in the sector. The firm aims to trade on the Nasdaq under the ticker symbol CRWV, with institutional investors looking closely at the upcoming pricing decision.

Morgan Stanley, J.P. Morgan, and Goldman Sachs are leading underwriters for the offering.