CoreWeave (CRWV): The AI Infrastructure Play That's Just Getting Started

The AI revolution is reshaping industries, and the infrastructure enabling it is becoming the new battleground. Among the contenders, CoreWeave (CRWV) stands out as a hidden champion of the AI cloud infrastructure boom. With triple-digit revenue growth, a blockbuster partnership with OpenAI, and a backlog of $25.9 billion, CoreWeave is positioned to capitalize on the $400 billion AI infrastructure market. Yet, its valuation remains underappreciated compared to peers like NVIDIA (NVDA) or Crowdstrike (CRWD). Here's why investors should act now before the crowd catches on.

Strategic Partnerships: The Engine of Growth

CoreWeave's rise is anchored in its alliances with industry titans. The $11.2 billion deal with OpenAI—representing nearly half of its total backlog—is its crown jewel. This partnership ensures CoreWeave is the default infrastructure provider for one of the most advanced AI labs globally. OpenAI's models, including the upcoming GPT-6, will require massive compute power, and CoreWeave's purpose-built data centers are primed to meet this demand.

IBM's collaboration is another critical win. CoreWeave is now delivering compute capacity for IBM's Granite models, expanding its reach into enterprise AI applications. This diversifies its customer base, reducing reliance on Microsoft, which still accounts for 62% of revenue. As enterprises shift from experimentation to production-scale AI, CoreWeave's infrastructure—optimized for AI workloads—will be in high demand.

Revenue Growth: A Triple-Header Surge

CoreWeave's financials are staggering. In Q1 2025, revenue surged to $981.6 million, a 420% year-over-year jump. Adjusted EBITDA hit $606.1 million, with a 62% margin, signaling operational efficiency. While net losses persist due to high stock-based compensation and debt, the Adjusted Net Loss improved to -15%, down from -12% in 2024.

The real story is the $25.9 billion backlog, which includes recurring payments of $14.7 billion. This backlog isn't just a number—it's a multiyear revenue pipeline. The OpenAI deal alone contributes $11.2 billion, but the $11.2 billion of committed contracts with hyperscalers and enterprises highlights the breadth of demand.

AI Infrastructure Demand: The Fuel of Expansion

The AI boom isn't slowing. Enterprises are investing billions in AI infrastructure, and CoreWeave is scaling to meet this surge. Its data centers now support 420 MW of active power and 1.6 GW of contracted power, enabling it to handle exponential workloads. Technical milestones, like its Platinum ClusterMAX™ Rating and leadership in MLPerf benchmarks, cement its reputation as a performance leader.

CoreWeave's AI Object Storage (CAIOS) and support for NVIDIA's AI Enterprise software further differentiate it. These products reduce latency and streamline workflows for clients, making its platform irreplaceable for AI-native businesses.

Valuation: A Bargain at 30x Sales?

At a 30x sales multiple, CoreWeave's valuation might seem high. But compare it to Crowdstrike (CRWD), which traded at 45x sales during its high-growth phase. CoreWeave's $25.9 billion backlog (vs. its 2025 revenue guidance of $5.0 billion) suggests it can grow into its multiple. Even if just 50% of the backlog converts to revenue over five years, the current valuation looks reasonable.

Critics cite $10.6 billion in debt and a net loss. But CoreWeave's EBITDA margins are expanding, and its IPO and debt refinancing have improved liquidity. The $1.4 billion IPO proceeds and a $2 billion senior notes offering have bolstered its balance sheet, signaling investor confidence in its execution.

Investment Thesis: Buy Before the Crowd

CoreWeave is undervalued relative to its growth trajectory and backlog. While risks like customer concentration and debt remain, the $11.2 billion OpenAI deal and enterprise wins provide a moat. As AI moves from hype to reality, CoreWeave's specialized infrastructure will become indispensable.

Act now: The stock has surged 120% YTD, but it's still early. Mainstream recognition—driven by AI adoption milestones—will push it higher. For growth investors, CoreWeave offers a rare blend of secular tailwinds, a fortress-like backlog, and a valuation still grounded in fundamentals. This is a buy before the next wave of AI hype.

Risk Disclosure: CoreWeave's reliance on major clients and high debt levels pose risks. Investors should monitor customer diversification and margin improvements.

Final Note: CoreWeave's stock is volatile. Only invest what you can afford to lose.