Citi Upgrades CoreWeave Stock to 'Buy' Ahead of Q2 Earnings Amid Rising Demand for AI-Powered Cloud Computing

CoreWeave (CRWV) stock rallied 12% in pre-market trading after Citi analyst Tyler Radke upgraded it to Buy from Hold and maintained a $160 price target. The upgrade was based on a stronger demand picture, driven by rising capital spending by Microsoft, a major customer of CoreWeave. The company is scheduled to announce Q2 earnings on August 11 and is expected to report a loss per share of $0.23 on revenue of $1.08 billion.

CoreWeave (CRWV) stock experienced a significant rally in pre-market trading on July 2, 2025, following a bullish upgrade from Citi analyst Tyler Radke. The upgrade came with a price target of $160, reflecting a stronger demand picture driven by rising capital spending from Microsoft, a major customer of CoreWeave. The company is scheduled to release its Q2 earnings on August 11, with analysts expecting a loss per share of $0.23 on revenue of $1.08 billion.

The upgrade was based on several factors, including the increasing demand for CoreWeave's AI cloud infrastructure services. Microsoft's rising capital expenditures, which made up 72% of CoreWeave's Q1 revenue, were highlighted as a key driver for the upgrade [3]. Additionally, the company's noncancellable contracts with an average duration of roughly four years provide near-term revenue visibility, setting the stage for potential earnings beats and guidance raises.

CoreWeave is the first cloud provider to deploy Nvidia's Blackwell Ultra GPUs, which has contributed to its recent rally despite the stock's volatility. The company's leadership in GPU-as-a-Service and potential for verticalization up the software stack offer upside opportunities. However, the stock's limited trading history and heavy customer concentration make it a high-risk, high-reward investment [3].

The upgrade comes amidst a broader trend of tech giants increasing their AI spending and debt loads, as seen in the recent AI race shifting to credit markets [2]. CoreWeave's strong revenue growth and market position as an AI cloud leader have been bolstered by its recent debt financing activities, including a $2.6 billion delayed draw term loan facility and various bond offerings [1, 6].

Investors should closely monitor CoreWeave's Q2 earnings report and any further analyst coverage to gauge the potential impact on the stock price. The company's strong fundamentals and strategic partnerships, such as its collaboration with Weights & Biases, provide a solid foundation for continued growth.

References:
[1] https://www.barrons.com/articles/coreweave-stock-buy-ai-microsoft-7438a6a0
[2] https://stockanalysis.com/stocks/crwv/
[3] https://finance.yahoo.com/news/coreweave-gets-citi-lift-ahead-203039721.html
[6] https://www.businesswire.com/news/home/20250701005003/en/CoreWeave-Closes-2.6-Billion-Secured-Debt-Financing-Facility-Strengthening-Market-Position-as-AI-Cloud-Leader