Meet the Exciting AI Stock That Has More Than Tripled This Year, and Which Nvidia Is Investing In

Core View - CoreWeave, an AI-first cloud computing business, is experiencing rapid growth but is currently operating at a loss, raising concerns about its long-term profitability [4][5][8][11]. Company Overview - Nvidia holds a significant stake in CoreWeave, with over 24 million shares valued at more than $3 billion, making it the largest investment in Nvidia's portfolio [2]. - CoreWeave's stock has tripled since its public debut earlier this year but remains 25% below its all-time high [2]. Financial Performance - In Q2, CoreWeave reported a 207% year-over-year revenue increase to $1.2 billion, with a revenue backlog of $30.1 billion, reflecting strong business visibility [5]. - Despite the impressive revenue growth, CoreWeave is not generating net income, which raises questions about its business model sustainability [8][11]. Market Dynamics - CoreWeave's business model relies on renting computing power to companies that cannot build their own data centers, specifically targeting AI needs [4]. - The company faces recurring expenses due to the short lifespan of Nvidia's GPUs, which may hinder its ability to scale profitably [9][11]. Investment Considerations - Investors are concerned about CoreWeave's lack of profitability, especially during a period of significant AI investment [11]. - The recommendation is to consider investing in Nvidia instead, as it is expected to continue strong GPU sales in the coming years [12].