CoreWeave stock jumped over 7% in extended hours after the company published its third-quarter results, which provided more insight into its business. CRWV jumped to $56.6, up modestly from this month’s low of $40. This article looks at its earnings report and why the depreciation costs point to more challenges ahead.
CoreWeave Published Strong Results as Demand Surged
CRWV stock rebounded after the neocloud leader reported mixed earnings. The results came at a time when CoreWeave’s business is facing major challenges, including soaring bond yields.
On the positive side, CoreWeave said that its revenue surged in the third quarter. It made over $3.7 billion, up by 168% from a year earlier. This surge happened as demand for its services rose, with the revenue backlog surging to $132 billion. That amount makes it the biggest neocloud company in the world.
Most notably, the company’s key profitability metric soared. Its adjusted earnings before interest, tax, depreciation, and amortization (EBITDA) soared by 62% to $2.3 billion, which is a positive sign. Its adjusted operating income rose to $379 million.
CoreWeave Report Had Some Red Flags
The earnings report suggested that the company had some major red flags. First, the company’s adjusted net loss surged to $529 million during the quarter. The management expects that the loss will continue before it breaks even.
Second, the company’s depreciation is enormous, and this trend may continue in the future. The company’s revenue jumped to over $3.7 billion. However, it also reported a big jump in its depreciation and amortization (D&A). Its D&A cost jumped to over $1.88 billion, which is over 50% of its revenue.
CoreWeave’s D&A jumped to over $4.4 billion in the first nine months of the year, a significant amount compared to the $8.3 billion it made in revenue. These numbers are notable because some analysts are warning of future write-downs among neocloud companies. On the positive side, the large depreciation metrics will help the company reduce its tax bill.
Third, the results also showed that the company plans to spend more money in capital expenditures this year. It plans to spend between $37 billion and $39 billion, higher than the previous guidance of between $35 billion and $39 billion. These numbers mean that the company will need to spend money over time.
Further, the company is incurring billions of dollars in interest payments, a trend that may continue as bond yields rise. The company’s interest costs jumped to over $846 million in the third quarter and $2 billion in the first nine months of the year. Also, the company plans to spend between $1.05 billion and $1.15 billion in interest in the fourth quarter.
CoreWeave’s business is also at risk as investors remain concerned about the artificial intelligence (AI) bubble remains. If the bubble bursts, neoclouds like CoreWeave will be one of the most affected companies.
CoreWeave Stock Price Analysis
The daily chart shows that the CRWV stock has been in a strong sell-off in the past few months. It dropped to a low of $40.4, its lowest level in months, and a sign that bears wanted to push it to a record low.
The stock remains below the important support level of $63.40, its lowest level in December last year and July this year. That retreat is a sign that the stock is forming a break-and-retest pattern.
Therefore, the stock will likely continue falling, potentially to the key support level of $40. A drop below that level will point to more downside, potentially to $35.
This article is for informational purposes only and does not constitute financial or investment advice. Stock prices involve market risks, and company forecasts may differ from actual results. Readers should independently review official financial disclosures before making investment decisions.
Crispus is a distinguished Financial Analyst at, bringing over 12 years of expertise in cryptocurrency markets, specializing in Bitcoin and altcoins. Renowned for his sharp insights at the nexus of market trends and breaking news, Crispus delivers actionable analysis to empower investors. His work is prominently featured across leading platforms, including BanklessTimes, CoinJournal, HypeIndex, SeekingAlpha, Forbes, InvestingCube, Investing.com, and MoneyTransfers.com, cementing his reputation as a trusted voice in the financial world.
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