CoreWeave: Echoes of Amazon’s Expansion-Driven Approach

CoreWeave Achieves $5 Billion Annual Revenue Milestone

On Thursday, CoreWeave (CRWV) announced its fourth-quarter financial results after the market closed. The company, known for its large-scale GPU-accelerated cloud services, set a new industry record by reaching $5 billion in yearly revenue faster than any other cloud provider. CoreWeave’s annual revenue soared from $1.9 billion in 2024 to $5.1 billion in 2025, reflecting a remarkable 168% year-over-year increase.

Backlog Grows to $66.8 Billion

CoreWeave’s revenue backlog experienced explosive growth, climbing to $66.8 billion—over four times higher than its $15 billion starting point earlier in the year. The company recently secured a $2 billion investment from Nvidia (NVDA), a leader in artificial intelligence. This partnership is especially important as CoreWeave remains a preferred collaborator for Blackwell GPU rollouts and was the first to implement Nvidia’s GB300 NVL72 systems.

Factors Behind Recent Share Price Decline

Despite CoreWeave’s rapid earnings growth, its stock price has retreated significantly from its peak of around $187 last June. Three main factors have contributed to this pullback:

• Lock-Up Expiration: Following a major post-IPO rally, early private investors often capitalize on liquidity events to realize gains, leading to increased selling pressure.
• Magnetar Capital’s Share Sales: Magnetar Capital, an early strategic backer, sold some of its holdings after the IPO, similar to other early insiders seeking to lock in profits.
• Rising Debt: To keep pace with surging demand driven by hyperscaler capital expenditures and the AI boom, CoreWeave has taken on substantial debt.

Why CoreWeave Remains Attractive

Despite these challenges, CoreWeave’s stock is considered a buy. The issues outlined above are expected to diminish over time. The IPO lock-up period ended in August, so insider selling should gradually decrease. Although Magnetar Capital sold a portion of its shares, it remains a significant shareholder and has expressed continued confidence in CoreWeave’s long-term prospects.

CoreWeave’s Growth Strategy Echoes Amazon’s Approach

CoreWeave’s business model can be likened to the railroad industry of the 19th century, where initial investments were immense, but once infrastructure was in place, profit margins soared. A modern parallel is Amazon (AMZN), which famously operated at a loss for years while reinvesting in its platform, technology, and customer experience—ultimately leading to massive stock appreciation. CoreWeave’s leadership appears to be following a similar path, prioritizing growth and infrastructure over short-term profits.

Conclusion

CoreWeave’s share price volatility is largely a reflection of its rapid expansion rather than any underlying weakness. While short-term debt concerns persist, the company’s enormous backlog and strong partnership with Nvidia provide a solid foundation for future growth.