CoreWeave’s $66.8 billion backlog strengthens its prospects for sustained expansion

CoreWeave Reports Significant Growth and Expanding Backlog

CoreWeave (CRWV) has announced robust results for the fourth quarter of 2025, highlighted by a remarkable revenue backlog of $66.8 billion. This figure represents a more than fourfold increase over the year, indicating strong, ongoing customer interest in the company’s AI cloud infrastructure. These substantial contracts provide a clear view of sustained demand and are fueling CoreWeave’s aggressive infrastructure growth strategy.

The surge in backlog is largely attributed to rising demand for AI infrastructure, with management noting that more clients are now implementing solutions focused on inference. CoreWeave also revealed that it is securing reserved instance agreements for infrastructure that has yet to be deployed, demonstrating high confidence from its customer base.

Another notable trend is the extension of contract durations. The company shared that the average contract length has grown from four to approximately five years, reflecting deeper and longer-term customer partnerships. These agreements span both current and previous GPU generations, and conversations are already underway regarding future product offerings.

CoreWeave’s Financial Performance and Expansion Plans

To meet these extended commitments, CoreWeave is rapidly scaling its operations. By the end of 2025, the company operated over 850 megawatts of active power across 43 data centers, having added 260 megawatts in the final quarter alone. In total, CoreWeave secured contracts for nearly two additional gigawatts of power during the year, bringing its total contracted capacity to more than 3.1 gigawatts, most of which is expected to be operational by 2027. Looking ahead, management aims to add over five gigawatts of new data center capacity by 2030.

For 2026, CoreWeave anticipates capital expenditures between $30 billion and $35 billion, with plans to double its active power capacity to over 1.7 gigawatts. Revenue projections for 2026 are set between $12 billion and $13 billion, representing a 140% increase year-over-year. The company expects all contracts for new capacity to begin generating revenue by the close of 2026.

Despite these positive developments, CoreWeave faces mounting competition in the AI sector from both specialized firms like Nebius (NBIS) and major players such as Microsoft (MSFT).

Competitor Backlog and Market Position

Microsoft continues to be a dominant force in technology, with Azure ranking among the world’s leading cloud platforms. In the most recent quarter, Microsoft’s commercial remaining performance obligation (RPO) reached $625 billion, up 110% year-over-year, reflecting strong, multi-year commitments across its cloud services.

Microsoft reported that about a quarter of this RPO will be recognized as revenue within the next year, with the remainder to follow. Much of this growth is fueled by significant Azure contracts with organizations like OpenAI and Anthropic, highlighting robust demand for Azure’s AI and cloud capabilities.

Nebius, another rapidly growing AI infrastructure provider, does not disclose backlog figures like CoreWeave. However, the company stated that demand continues to outpace available resources, with compute capacity sold out for the third and fourth quarters of 2025 and already fully booked for the first quarter of 2026.

Similar to CoreWeave, Nebius is experiencing longer average contract durations, with new customer agreements increasing by 50%. The company is accelerating its expansion, announcing nine new data centers and securing over two gigawatts of contracted power, with plans to surpass three gigawatts by 2026. Nebius projects annualized revenue between $7 billion and $9 billion by the end of 2026.

CoreWeave’s Stock Performance and Valuation

Over the past month, CoreWeave’s share price has declined by 22.7%, compared to a 0.8% drop in the Internet Software sector.

Currently, CoreWeave’s Price/Book ratio stands at 7.46, significantly higher than the industry average of 5.18.

The consensus estimate for CoreWeave’s 2026 earnings has remained unchanged over the last two months.

At present, CoreWeave holds a Zacks Rank #4 (Sell).