CoreWeave Stock Drops 11.4% Amid Concerns Over Spending and Financial Pressure
On July 25, CoreWeave (NASDAQ: CRWV) shares fell by 11.4%, closing at $71.88 after a week of volatility that erased gains from earlier in the week when prices had reached above $86. The decline came despite positive news about increased demand for AI infrastructure and Alphabet raising its capital spending outlook to as much as $205 billion, including plans to use more third-party capacity like CoreWeave's. The sell-off appears driven by concerns over CoreWeave’s financial health rather than a lack of market demand. The company reported strong first-quarter revenue growth—up 112% year-over-year—but its adjusted EBITDA margin dropped from 62% to 56%, and operating income fell sharply due to depreciation costs on data centers and GPUs. Management expects these margins to improve gradually, but the capital expenditures for this year are projected at $31 billion to $35 billion—far exceeding annual revenue of around $6.2 billion. Investor anxiety is also fueled by rising debt levels and interest expenses. CoreWeave’s total debt reached nearly $24.9 billion in March 2026, up from $21.4 billion the previous quarter, with net interest expense expected to reach between $650 million and $730 million for Q2 alone—nearly matching its full-year interest costs of 2025.
Tickers: $CRWV
Topics: AI cloud capital spending EBITDA margins revenue growth