CoreWeave Stock Surges 26.3% After Nvidia's $900M Stake Revealed

CoreWeave, an AI cloud computing company, experienced a significant surge in its stock price on May 16, following the revelation of a substantial ownership stake by Nvidia. This news sparked a 26.3% increase in CRWV stock, pushing its market capitalization above $38 billion. The stock was last seen trading around $81, marking a 23% gain for the day.

The rally was triggered by regulatory filings from Nvidia, which showed that the company owned $900 million worth of CRWV stock at the end of the first quarter. Assuming Nvidia has not sold any shares since then, the value of these holdings has more than doubled. At the time of CoreWeave’s initial public offering (IPO), Nvidia’s ownership stake was 17.9 million shares.

CoreWeave’s stock has seen a remarkable increase of over 100% from its IPO price of $40 in late March, significantly outperforming the Nasdaq Composite Index and the broader US stock market during this period. The company’s fiscal first-quarter earnings report, released on May 14, showed a 420% surge in revenue but also a 487% spike in operating expenses. Consequently, the company’s net loss widened by 143% compared to the previous year, leading to a temporary decline in stock price shortly after the financials were released.

CoreWeave’s journey began in 2017 as an Ethereum mining operation called Atlantic Crypto. The company transitioned away from digital assets in 2018 due to the bear market and rebranded to CoreWeave in 2019. Leveraging its GPU infrastructure, CoreWeave started providing cloud computing services and capitalized on the AI boom to secure a massive IPO launch. The company has also secured major investors, including a deal with OpenAI to supply AI infrastructure for the ChatGPT developer’s data needs.

CoreWeave operates within the broader cloud computing industry, which is forecast to become a $2 trillion market by 2030 as AI applications gain mainstream adoption. Another estimate suggests that the global cloud AI market alone could approach $600 billion by 2032, marking a compound annual growth rate of 28.5%.