CoreWeave’s Stunning Rally Creates Prove-It Moment For Earnings

(Bloomberg) — CoreWeave Inc. shares are on a scorching run in 2026 as demand for computing capacity to power artificial intelligence keeps growing. But now investors want to see some proof that the neo-cloud provider is executing on its ambitious plans.

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The chance arrives when CoreWeave reports earnings after the bell on Thursday. Recent results from the biggest AI spenders like Alphabet Inc. and Meta Platforms Inc. made it clear that the need for computing power is insatiable as capital expenditures continue to rise. Considering the company rents access to AI infrastructure featuring the latest chips from Nvidia Corp., that plays right into its hands.

“There is an insane amount of demand for AI compute,” said Tejas Dessai, director of thematic research at Global X ETFs. “The backdrop is extremely positive for CoreWeave.”

Investors will be closely monitoring CoreWeave’s revenue acceleration, its outlook for the rest of the year and its backlog heading into 2027, he said.

The stock is up 78% this year and a stunning 218% since the Livingston, New Jersey-based company went public in March 2025. The latest rally got going roughly a month ago as investors regained faith in the AI trade and CoreWeave announced deals with Meta, Anthropic PBC and Jane Street Group in quick succession.

CoreWeave shares were down as much as 9.1% in intraday trading Thursday after rallying 7.9% on Wednesday.

Of the 36 analysts tracked by Bloomberg who follow CoreWeave, 23 have buy ratings on the stock and only two have sells. But their average 12-month price target of $131 is below where the shares closed Wednesday, even though it’s been rising over the past six months.

Wall Street expects the company to report revenue of nearly $2 billion in the first quarter, twice what it posted a year ago, and a loss of $1.20 per share, which would be an improvement from a loss of $1.49 a share in the first quarter of 2025. CoreWeave’s revenue backlog was nearly $67 billion as of Dec. 31, and the recent deals should raise its remaining performance obligations significantly.

“CoreWeave’s 1Q results will likely echo strength at Amazon.com and Alphabet’s Google amid rising AI-compute demand and the need for higher near-term spending to ramp up infrastructure,” Bloomberg Intelligence analyst Anurag Rana wrote in a May 4 note. “We see a high likelihood that management will increase both its 2026 sales and capital expenditure targets, backed by a recent string of new financing deals.”

Selloff Risk

Of course, there’s a risk that these earnings will give investors reasons to sell the stock, which has happened after every report since CoreWeave’s IPO, although the shares have quickly recovered from the downturns. In February, the company said its capital expenditures would be higher than expected and the stock tumbled 19%, its worst session in six months.

“The market has made itself comfortable with a certain level of capex spending from CoreWeave, and if they come out with a figure that far exceeds that, I think that would be something that the market scrutinizes very closely,” Dessai said. “They have to back it up with commensurate revenue scale as well.”

Heightened spending also puts the focus on margins. CoreWeave is expected to post a first-quarter gross margin of about 67%, with analysts and investors looking for that number to climb over the coming quarters.

“Sustained margin expansion remains necessary to unlock further upside for the stock,” Bank of America analysts led by Tal Liani wrote in a May 5 note, in which they raised their price target to $140 from $120. “As revenue recognition ramps through the year, we expect margins to follow.”

Investors will also be listening for details about CoreWeave’s rising debt level, and any update on its relationship with OpenAI. The shares slumped last week after the AI startup reportedly missed its sales and user targets.

“If they were to continue to finance every one of these contracts that they brought on at junk bond rates, then that would not be sustainable because I wouldn’t think that the business would inflect quickly enough to generate the cash to be paying double-digit interest rates,” said Paul Meeks, head of technology research at Freedom Capital Markets, who is bullish on CoreWeave and is generally encouraged by the company’s spending plans.

But ultimately, what Meeks and other investors are most concerned about is how much computing power CoreWeave brought online in the quarter.

“It’s all about, tell me how many megawatts you had on Dec. 31, 2025, and how many active megawatts you have on March 31, 2026,” he said. “That’s all I want.”

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CoreWeave’s Stunning Rally Creates Prove-It Moment for Earnings

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