TLDR
- CoreWeave shares plummeted 14% Wednesday followed by another 5.5% decline Thursday, closing at $80.97
- Bloomberg reported Meta Platforms is considering launching a cloud service to monetize surplus AI computing capacity
- The tech giant currently represents one of CoreWeave’s largest revenue sources
- SoftBank separately revealed intentions to establish a U.S. AI cloud operation branded SB Neo
- Rosenblatt Securities reaffirmed its Buy recommendation with a $250 price objective, viewing the decline as an entry point
CoreWeave (CRWV) stock suffered a brutal two-day slide this week. Shares of the AI cloud infrastructure provider plunged 14% during Wednesday’s session before extending losses with a 5.5% drop Thursday, settling at $80.97. The collapse erased more than $7.5 billion from the company’s market capitalization in just 48 hours.
CoreWeave, Inc. Class A Common Stock, CRWV
The catalyst came from a Bloomberg report indicating Meta Platforms is evaluating whether to commercialize its surplus AI computing infrastructure by offering it to external customers — a move that would position the social media giant as a direct rival in the neocloud space where CoreWeave competes.
The development carries particular significance since Meta ranks among CoreWeave’s most important clients, creating a scenario where a major revenue contributor could transform into a formidable adversary.
CoreWeave responded swiftly to the speculation. “We’re continuing to see incredibly strong demand across a growing and increasingly diverse customer base, including Meta who is a great customer and partner of CoreWeave’s,” the company stated publicly.
The firm emphasized its view that the expanding AI infrastructure investment landscape represents “a rapidly expanding market, not a zero-sum game.”
Competitor Nebius experienced similar share price pressure following the Meta disclosure, signaling investor concerns extend across the entire neocloud sector rather than being isolated to CoreWeave.
Rosenblatt Takes Contrarian Stance
While many investors headed for the exits, Rosenblatt Securities analysts John McPeake and Tanu Chauhan issued a Wednesday evening note characterizing the selloff as “presents a buying opportunity.”
Their analysis highlighted persistent robust demand for GPU computing resources, noting capacity constraints remain widespread throughout the industry. The analysts also emphasized an important contractual consideration — Meta presumably lacks authorization to redistribute CoreWeave capacity it has committed to through 2032 to outside parties.
Rosenblatt maintained its Buy recommendation while keeping its $250 price objective unchanged, implying potential appreciation of approximately 209% from present levels.
Wall Street sentiment overall shows greater division. Among 35 analysts tracking the stock, 21 recommend buying, 12 suggest holding, and 2 advise selling. The average price target stands at $135, representing roughly 58% upside from current prices.
SoftBank Announcement Compounds Concerns
Compounding Thursday’s selling pressure, SoftBank disclosed plans to establish its own AI cloud platform in the United States, provisionally named SB Neo. The announcement introduces yet another prospective competitor entering the market CoreWeave has been cultivating.
CoreWeave shares have now advanced just 13% year-to-date but remain down 51% over the trailing twelve months. The stock has traded within a 52-week range spanning from $63.80 to $166.22.
The company’s most recent quarterly results, released May 7, demonstrated revenue of $2.08 billion — representing 111.6% year-over-year growth. However, CoreWeave fell short on profitability metrics, recording a $1.40 per share loss compared with analyst expectations for a $1.17 loss.
Insider transaction activity has drawn attention recently. Throughout the past 90 days, company insiders have divested more than 26.5 million shares valued above $3 billion.
On the institutional investment front, Vanguard substantially expanded its stake by 275.6% during Q4, acquiring an additional 20.4 million shares.
CoreWeave stock commenced Thursday trading at $85.68, carrying a market capitalization of $38.35 billion.
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