CoreWeave's IPO Price Cut to $40, Nvidia Invests $2.5 Billion

Nvidia is planning to invest $2.5 billion in the initial public offering (IPO) of CoreWeave, with an intended issue price of $40 per share. This price is lower than the previously proposed range of $47 to $55 per share, suggesting that the company may be considering reducing the scale of its fundraising efforts.

Sources close to the matter have revealed that CoreWeave has not yet made a final decision on scaling back its offering, but discussions with investors are underway. The company is expected to go public this Friday.

Neither CoreWeave nor Nvidia has commented on the IPO or the potential price reduction. Nvidia is already a significant customer and holds approximately 6% of CoreWeave's shares.

CoreWeave was originally founded in 2017 as Atlantic Crypto, a cryptocurrency mining infrastructure company. As cryptocurrency prices fluctuated, the company shifted its focus to AI cloud computing and rebranded as CoreWeave. During this transition, CoreWeave acquired a large number of Nvidia GPUs to provide remote computing services based on AI chips for its clients.

CoreWeave's strategic pivot has proven successful. According to its prospectus filed earlier this month, CoreWeave's revenue for 2024 reached $1.92 billion, a year-over-year increase of over 700%, although it reported a net loss of $863 million. Two clients accounted for 77% of its revenue, with Microsoft being the largest customer at 62%.

Additionally, the company disclosed that by the end of 2024, CoreWeave had established 32 data centers and deployed over 250,000 Nvidia GPUs, demonstrating its significant investment in AI infrastructure.

In recent years, high inflation and rising interest rates have led investors to avoid high-risk assets, causing the U.S. IPO market to experience a three-year downturn. However, the rapid development of the AI industry has brought renewed hope for market recovery. CoreWeave's IPO is seen as a crucial signal for the revival of the IPO market.

Alongside CoreWeave, other companies such as StubHub, Hinge Health, and Klarna are also preparing for their IPOs. Investors will closely monitor whether these new entrants can revitalize the stagnant primary market.