CoreWeave (CRWV) is back in the spotlight following a very bearish note from HSBC analyst Abhishek Shukla, who initiated coverage with a $32 price target, implying a staggering 75% fall from current levels. The analyst issued a “Sell” recommendation on the red-hot AI infrastructure play, sending shares down over 6% intraday on July 18.
The fall occurs at a critical time for CoreWeave. It has risen over 240% since its IPO in March, driven in general by AI infrastructure hype and by blockbuster OpenAI and Microsoft (MSFT) partnerships.
Yet with escalating costs, high-capital needs, and deep customer concentration, some analysts now believe the run higher has gone too far.
CoreWeave (CRWV) is a Livingston, New Jersey cloud computing company focused on supporting high-performance computing workloads. It is an “AI Hyperscaler” offering customized infrastructure-as-a-service with support for some of the market’s toughest compute demands. It has a market capitalization approaching $60 billion.
CRWV stock has been a roller coaster since going public in March 2025. The stock hit a high of $187.00, a rise of well over 400% above the IPO price, only to correct sharply in the last few weeks. The stock is currently trading near $130, down about 30% from its highs.
CoreWeave operates with high valuation multiples. It carries a price-sales ratio of 21.5x and a price-book ratio of 28.1x. The HSBC downgrade and warning is an indicator of valuation risk due to a lack of earnings and a capital-intensive business model.
CoreWeave’s Q1 2025 results were a mixed bag. It had revenue of $981.6 million, representing a year-over-year growth rate of 420%. However, its GAAP net loss of $314.6 million was more than twice as wide as the figure in the prior-year quarter. The operating loss during the quarter was $27.5 million, 263% worse than the prior year. Stock-based compensation during the quarter was $177 million, heavily weighing on net profitability after its IPO.
The company also promoted new infrastructure installations, support for the GPU chip NVIDIA GB200, and Platinum status in SemiAnalysis’s ClusterMAX GPU cloud rankings. Although these enhance its technical superiority, future funding needs for these initiatives are making risk-conscious investors nervous.
