In Q2, CoreWeave's revenue skyrocketed to an impressive $1.2 billion, but the company's stocks plummeted in after-hours trading.
CoreWeave, a leading AI infrastructure provider, has reported a robust Q2 2025 revenue of $1.21 billion, marking a staggering 206.7% year-over-year increase. Despite this impressive growth, the company's financials have raised concerns due to thin operating margins and a lack of clear path to profitability in 2025 [1][2][4].
The strong revenue growth is primarily driven by surging demand for AI infrastructure. CoreWeave has expanded its AI-focused data center footprint and deployed new GPUs for advanced AI workloads [4]. The CEO highlighted the rapid scaling in AI infrastructure and a strategic push into large data center projects and acquisitions [4].
However, the company's operating expenses near $1.19 billion for the quarter, coupled with a slim operating income of $19.2 million, indicate very narrow margins [1][4]. CoreWeave has not projected progress towards adjusted operating income profitability for the full year 2025, which has worried investors and led to a significant stock price decline of over 21% after the earnings release [2].
CoreWeave's revenue backlog, representing signed multi-year commitments for future compute capacity, stands at approximately $30 billion [1]. The company's shares fell by more than 10% during after-hours trading after the earnings report [3].
Analysts and investors are questioning CoreWeave's ability to convert revenue into profit and maintain a strong competitive position long-term. Jeffrey Emanuel, founder and CEO of Pastel Network, argues that CoreWeave's accounting might be masking deeper losses by assuming a six-year useful life for their GPUs [5]. Emanuel contends that if CoreWeave's depreciation expense was adjusted to something like 2.5 or 3 years and front-loaded, they could potentially be losing money [5].
Ram Kumar, a core contributor at OpenLedger, suggests that CoreWeave's edge in securing NVIDIA's newest GPUs is diminishing as rivals catch up [6]. Kumar also points out that a slowdown in AI training budgets or customer consolidation could squeeze CoreWeave's cash flow, making long-term contracts and software-driven stickiness critical to resilience [6].
Without faster margin expansion and locked-in utilization, CoreWeave could potentially transition from a high-growth disruptor to a low-return infrastructure landlord, especially in a price-war environment [1]. This combination suggests that while CoreWeave is growing rapidly and capitalizing on AI demand, questions remain about its ability to maintain profitability and sustain its competitive edge [2][4].
CoreWeave did not immediately respond to Decrypt's request for comment. The company is currently facing resistance to its $9 billion all-stock takeover of Core Scientific [3].
[1] CoreWeave Q2 2025 Earnings Report [2] CoreWeave Stock Tumbles After Earnings Miss and Guidance Cut [3] CoreWeave's $9 Billion All-Stock Takeover of Core Scientific Faces Resistance [4] CoreWeave's Q2 2025 Earnings Call Transcript [5] Pastel Network's Emanuel Questions CoreWeave's Accounting Practices [6] CoreWeave's Lead in the Market at Risk, Says OpenLedger's Ram Kumar
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