Core Performance - CoreWeave, Inc. reported record revenues of $1.36 billion in Q3 2025, reflecting a 134% year-over-year increase, and a revenue backlog of $55.6 billion, nearly doubling within a single quarter [1][8] - The company is solidifying its position as a leading cloud provider for AI, focusing on innovation to support the next generation of AI [1] Customer Contracts and Partnerships - CoreWeave secured a multi-year deal with Meta valued at approximately $14.2 billion and expanded its partnership with OpenAI to a total commitment of about $22.4 billion [2] - The company has deepened its relationships with various clients, including Inference.net, Mizuho Bank, NASA JPL, and Poolside, marking its sixth contract with a leading hyperscaler [2] Infrastructure Expansion - The company is rapidly expanding its data centers, adding eight new U.S. data centers and advancing its European expansion, including a significant site in Scotland [3] - CoreWeave is scaling its AI infrastructure, adding around 120 megawatts (MW) of active power to reach approximately 590 MW in total, with contracted power expanding to 2.9 gigawatts in Q3 [3] Financial Outlook and Challenges - Despite strong demand, CoreWeave faces supply chain pressures, leading to a revised full-year 2025 revenue forecast of $5.05 billion to $5.15 billion, down from earlier projections [4] - The company anticipates adjusted operating income between $690 million and $720 million, also lower than previous expectations [4] - Heavy capital expenditures and rising interest costs are additional concerns, with expected interest expenses for 2025 between $1.21 billion and $1.25 billion [5] Competitive Landscape - CoreWeave is facing intense competition in the AI cloud infrastructure space from companies like Microsoft and Nebius Group [5] - Microsoft plans to increase its AI capacity by over 80% in 2025 and is building the world's most powerful AI data center, while Nebius has secured a $3 billion agreement with Meta [6][7] Stock Performance and Valuation - CoreWeave's shares have gained 113.6% over the past year, significantly outperforming the Internet Software industry's growth of 9.2% [10] - The company's shares are trading at a Price/Book ratio of 15.71X, considerably higher than the industry average of 6X [12]

Core Insights - CoreWeave, Inc. (CRWV) reported a third-quarter 2025 loss per share of 22 cents, an improvement from a loss of $1.82 in the same quarter last year [1] - Adjusted net loss for the quarter was $41 million, compared to adjusted net income of $67 million a year ago [1] - Revenues reached a record $1.3647 billion, exceeding the Zacks Consensus Estimate by 6.8% and representing a 134% year-over-year increase, driven by demand for the AI-cloud platform [2][10] Revenue and Contracts - CoreWeave secured major customer wins, including a multi-year deal with Meta worth approximately $14.2 billion and an expanded partnership with OpenAI totaling $6.5 billion, bringing total commitments to about $22.4 billion [4][10] - Revenue backlog increased to $55.6 billion, up 271% year over year, nearly doubling quarter over quarter, driven by contracts with OpenAI, Meta, and hyperscalers [6][10] Infrastructure and Technology - The company added around 120 MW of active power, reaching approximately 590 MW in total, and expanded contracted power to 2.9 GW [5] - Key technology milestones included the deployment of NVIDIA GB300 NVL72 systems and the acquisition of OpenPipe to enhance AI training capabilities [5] Financial Performance - Total operating expenses were $1.3 billion, compared to $466.8 million in the prior year, with operating income at $51.9 million, down from $117.1 million [11] - Adjusted operating income was $217.2 million, up 74% year over year, while adjusted operating margin decreased to 16% from 21% [11] - As of September 30, 2025, the company had $3 billion in cash and cash equivalents, with cash provided from operating activities of $1.7 billion [12] Outlook and Market Reaction - The company lowered its 2025 revenue outlook to between $5.05 billion and $5.15 billion, down from a previous estimate of $5.15 billion to $5.35 billion [7] - Following the results, shares declined approximately 7% in after-market trading, although CRWV's shares have gained 164% over the past year, significantly outperforming the 11.9% rise of its Internet Software industry [8]

Core Insights - The article highlights five AI-focused stocks in the Internet Software and Services sector that are expected to perform well in 2026, driven by increased IT spending and the growing demand for web-based infrastructure and applications [2][4]. Company Summaries Palantir Technologies Inc. (PLTR) - Palantir's AI strategy integrates its Foundry and Gotham platforms, promoting AI adoption in government and commercial sectors, with a focus on processing large datasets for real-time insights [5][6]. - The company is aligning its AI initiatives with U.S. defense priorities, showcasing its capabilities in high-profile projects like the Department of Defense's Open DAGIR [6]. - Palantir's AI Platform (AIP) has shown adaptability across various industries, with a strong customer base in government and large corporations [7][8]. - Expected revenue and earnings growth rates for Palantir are 41.1% and 43% respectively for the next year, with a 20.9% improvement in earnings estimates over the past week [9]. Snowflake Inc. (SNOW) - Snowflake is positioned to benefit from the rising demand for cloud-based data platforms, with its AI Data Cloud unifying structured and unstructured data [11]. - The cloud analytics market is projected to grow from $35.39 billion in 2024 to $130.63 billion by 2030, indicating a 25.5% CAGR, which supports Snowflake's growth trajectory [12]. - Snowflake's platform is gaining traction among large enterprises, enhancing their ability to manage data and improve customer experiences [13][14]. - Expected revenue and earnings growth rates for Snowflake are 22.3% and 33.9% respectively for the next year, with a 4% improvement in earnings estimates over the last 60 days [15]. Datadog Inc. (DDOG) - Datadog is experiencing growth due to new customer additions and increased adoption of its cloud-based monitoring platform amid digital transformation [16]. - The company unveiled over 125 new products at DASH 2025, including AI observability tools, which enhance customer engagement and competitive positioning [17][18]. - Datadog's expected revenue and earnings growth rates are 19% and 15.4% respectively for the next year, with a 0.9% improvement in earnings estimates recently [20]. Atlassian Corp. (TEAM) - Atlassian is benefiting from the demand for remote working tools, with significant adoption of its AI-powered features, showing a 25X year-over-year increase in AI interactions [21][22]. - The company's focus on generative AI features is expected to drive long-term revenue growth, particularly through collaborations with OpenAI [23]. - Expected revenue and earnings growth rates for Atlassian are 20.8% and 27.7% respectively for the current year, with a 0.6% improvement in earnings estimates recently [24]. Zoom Communications Inc. (ZM) - Zoom is capitalizing on the hybrid work trend, with AI-driven solutions like Zoom Doc and AI Companion seeing significant user growth [25][26]. - The AI Companion has achieved a fourfold increase in monthly active users year-over-year, enhancing operational efficiencies for customers [26][27]. - Expected revenue and earnings growth rates for Zoom are 3% and 0.1% respectively for the next year, with a 3.9% improvement in earnings estimates over the last 60 days [28].

Industry Overview - The Internet Software and Services sector is experiencing growth due to increased IT spending on hybrid operating environments and mobile device penetration, prompting businesses to invest in web-based infrastructure and security software [1] - The Internet Software industry is ranked in the top 28% of Zacks Industry Rank, indicating expected outperformance in the market over the next three to six months [2] Company Highlights Palantir Technologies Inc. (PLTR) - Palantir's AI strategy integrates its Foundry and Gotham platforms, focusing on AI adoption in government and commercial sectors, with an expected revenue growth rate of 41.1% and earnings growth rate of 43% for next year [6][10] - The company is involved in significant government projects, such as the Department of Defense's Open DAGIR initiative, enhancing military operations through AI [7] - Palantir's AIP boot camps have attracted over 1,000 companies, showcasing its platform's capabilities across various industries [8] Snowflake Inc. (SNOW) - Snowflake is set to benefit from rising demand for cloud-based data platforms, with an expected revenue growth rate of 22.3% and earnings growth rate of 33.9% for next year [11][15] - The cloud analytics market is projected to grow from $35.39 billion in 2024 to $130.63 billion by 2030, with a CAGR of 25.5%, supporting Snowflake's growth trajectory [12] - Snowflake's AI Data Cloud is gaining traction across multiple industries, enhancing enterprise capabilities in data management and analytics [14] Datadog Inc. (DDOG) - Datadog is experiencing growth from new customer acquisitions and increased adoption of its cloud-based monitoring platform, with an expected revenue growth rate of 19% and earnings growth rate of 15.4% for next year [16][20] - The company unveiled over 125 new products at DASH 2025, including AI observability tools, enhancing its competitive position [17][18] - Datadog's solutions are increasingly used to monitor AI-powered applications, driving broader product usage [19] Atlassian Corp. (TEAM) - Atlassian is benefiting from the demand for remote working tools, with a 25X year-over-year increase in AI interactions among over 1 million monthly active users [22] - The company's AI-powered Rovo platform and automation tools are driving growth in premium and enterprise editions [23] - Atlassian's collaboration with OpenAI to enhance its software with generative AI features is expected to boost revenue [24] Zoom Communications Inc. (ZM) - Zoom is capitalizing on the hybrid work trend, with its AI Companion achieving a fourfold increase in monthly active users year-over-year [26][27] - The platform's integration with third-party applications and custom AI functionalities is enhancing operational efficiencies for customers [28] - Zoom has an expected revenue growth rate of 3% and earnings growth rate of 0.1% for next year [29]

Core Viewpoint - Rigetti Computing is preparing to release its third-quarter 2025 results, with expectations of a loss per share of 5 cents and revenues of $2.39 million, indicating a year-over-year growth of 37.5% in earnings but only a modest revenue growth of 0.4% [2][3]. Financial Performance - The consensus estimate for 2025 revenues is $8.7 million, reflecting a decline of 19.7% year over year, while the loss per share is expected to be 9 cents, suggesting a year-over-year growth of 75% [4]. - Rigetti has had mixed performance in the past four quarters, surpassing the consensus estimate once, missing once, and meeting expectations twice, resulting in an average earnings surprise of negative 10.8% [4]. Earnings Analysis - Rigetti has an Earnings ESP of 0.00%, indicating no expected earnings surprise for the upcoming report [5]. - The company currently holds a Zacks Rank of 3 (Hold), suggesting a neutral outlook [6]. Market and Operational Factors - The third-quarter performance is likely to be influenced by uncertainties in U.S. public-sector funding, particularly due to the expiration of the National Quantum Initiative [7]. - Rigetti's rollout of the Cepheus-1-36Q quantum system is expected to provide early benefits, with strong technical gains and increased experimentation among customers [8]. Cash Position and Valuation - Rigetti has over $570 million in cash and no debt, positioning it well for continued system development and stable margin execution [9]. - Year-to-date, Rigetti's shares have gained 125.1%, outperforming the broader Internet Software industry, which advanced 10.2% [12]. Long-Term Strategy - Rigetti aims to deliver a 100+ qubit chiplet-based system with approximately 99.5% fidelity by the end of 2025, with a long-term goal of achieving a 1,000-qubit system [13]. - The company is focusing on building an ecosystem through partnerships, such as the collaboration with Quanta Computer Inc., which includes significant financial commitments from both parties [17][18]. Commercial Developments - Recent orders for the Novera QPU systems indicate growing demand for quantum systems beyond government labs, with potential for broader enterprise adoption in the future [15][16]. - The integration of Novera with NVIDIA's DGX Quantum platform highlights Rigetti's efforts in hybrid quantum-classical workflows [18]. Investment Outlook - The upcoming third-quarter results are expected to reflect steady progress rather than a major financial turning point, supporting a hold view for investors [19]. - While Rigetti's balance sheet allows for continued investment, visibility into larger commercial demand remains limited, suggesting a cautious approach for prospective investors [21].

Core Insights - Rigetti Computing (RGTI) is expected to release its third-quarter 2025 results on November 10, with a consensus estimate for loss per share at 5 cents and revenues at $2.39 million, indicating a year-over-year growth of 37.5% in earnings but only a modest revenue growth of 0.4% [1][2] Financial Performance - The consensus for 2025 revenues is $8.7 million, reflecting a decline of 19.7% year over year, while the loss per share is estimated at 9 cents, suggesting a year-over-year growth of 75% [2] - RGTI has had mixed performance in the past four quarters, surpassing estimates once, missing once, and meeting expectations twice, resulting in an average earnings surprise of negative 10.8% [2] Earnings Estimates - The earnings estimates for the upcoming quarters remain stable, with the loss per share projected at -0.05 for Q1, -0.04 for Q2, -0.09 for F1, and -0.17 for F2 [3] Market Position and Valuation - RGTI currently holds a Zacks Rank of 3 (Hold), with an Earnings ESP of 0.00%, indicating lower chances of beating estimates [5][6] - Year-to-date, RGTI shares have gained 125.1%, outperforming the broader Internet Software industry, which advanced 10.2% [11] Strategic Developments - The third-quarter results are likely to be influenced by U.S. public-sector funding uncertainties, particularly due to the expiration of the National Quantum Initiative [7] - Rigetti's rollout of the Cepheus-1-36Q, the largest multichip quantum system, is expected to provide early benefits, with strong technical gains and access through Rigetti QCS and Microsoft Azure [8][9] - The company has over $570 million in cash and no debt, positioning it well for continued system development [9] Long-Term Vision - Rigetti aims to deliver a 100+ qubit chiplet-based system with approximately 99.5% two-qubit gate fidelity by the end of 2025, with a long-term goal of achieving a 1,000-qubit system [15] - Recent orders for Novera QPU systems indicate growing demand for quantum systems beyond government labs, suggesting potential for broader enterprise adoption [16][17] Partnerships and Collaborations - A strategic collaboration with Quanta Computer Inc. involves over $100 million in commitments from both partners, supporting manufacturing scale and system commercialization [18] - Integration with NVIDIA's DGX Quantum platform highlights Rigetti's focus on hybrid quantum-classical workflows, enhancing its ecosystem [18] Future Outlook - The upcoming third-quarter results are expected to reflect steady progress on Rigetti's chiplet-based roadmap, with continued focus on fidelity metrics and system deliveries rather than just near-term revenues [19][21] - While the balance sheet provides a cushion for ongoing investments, visibility into larger commercial demand remains limited, suggesting a cautious approach for prospective investors [21]

Core Viewpoint - Snowflake has shown exceptional performance with a 71.4% year-to-date surge, significantly outperforming its industry peers and reflecting strong investor confidence in its execution and growth potential in AI data cloud opportunities [2][3]. Company Performance - Snowflake's stock has outperformed industry peers like Microsoft (20.3% increase), Amazon (14% increase), and ServiceNow (17% decline) due to consistent revenue acceleration and a differentiated consumption model [3]. - The Zacks Consensus Estimate for Snowflake's Q3 fiscal 2026 revenues is $1.18 billion, representing a 25.4% year-over-year increase [5]. - The estimated earnings for Q3 fiscal 2026 are 31 cents per share, indicating a 55% year-over-year increase [11]. Competitive Advantage - Snowflake's competitive moat is strengthened by its AI-driven innovations, which enhance customer stickiness and differentiate it from competitors tied to broader application ecosystems [6][4]. - The company's AI Data Cloud is becoming essential for enterprises transitioning to unified data platforms, combining governance, analytics, and machine learning [4][7]. Growth Drivers - Snowflake's expanding enterprise ecosystem, including collaborations with Microsoft Azure and Amazon Web Services, is enhancing its global footprint and accelerating enterprise adoption [8]. - The Zacks Consensus Estimate for total customers in Q3 fiscal 2026 is 12,482, a 21.8% year-over-year increase, indicating deepening relevance in the enterprise data stack [9]. Valuation Metrics - Snowflake's forward price-to-sales multiple is 16.65X, significantly higher than the industry average of 5.09X and the sector average of 6.92X, reflecting its unique positioning as a high-growth, AI-driven data platform [10]. - The combination of healthy growth, operating discipline, and expanding margins supports Snowflake's premium valuation, reinforcing confidence in its sustained growth potential [12]. Conclusion - Snowflake's robust execution, rising enterprise adoption, and AI integration position it as a compelling growth story in the software space, with a balance of scale, innovation, and profitability [13].

Core Insights - Snowflake (SNOW) has experienced a significant 71.4% increase year to date, outperforming the Zacks Internet Software industry's 10.3% and the broader Zacks Computer and Technology sector's 26.4% [1] - The stock's performance is attributed to strong revenue acceleration and a differentiated consumption model that enhances operating leverage compared to peers like Microsoft, Amazon, and ServiceNow [2] Company Performance - The Zacks Consensus Estimate for Snowflake's Q3 fiscal 2026 revenues is $1.18 billion, reflecting a 25.4% year-over-year growth [5] - The estimated Q3 FY26 EPS is 31 cents, indicating a 55% increase year-over-year [6][14] Competitive Advantage - Snowflake's competitive moat is strengthened by its AI-ready data infrastructure, which integrates governance, analytics, and machine learning [4] - The company's cloud-neutral architecture allows seamless data management across multiple environments, enhancing its appeal to enterprises [9] Customer Growth - The total customer estimate for Q3 FY26 is 12,482, a 21.8% increase year-over-year, with remaining performance obligations (RPO) projected at $7.46 billion, up 30.8% year-over-year [10] Valuation and Growth Potential - Snowflake's forward price-to-sales multiple is 16.65X, significantly higher than the industry average of 5.09X and the sector average of 6.92X, indicating strong fundamentals [11] - Management expects product revenues between $1.125 billion and $1.13 billion for Q3 FY26, suggesting 25-26% growth [14] Conclusion - Snowflake's robust execution and rising enterprise adoption position it as a compelling growth story in the software sector, supported by improving operating margins and consistent revenue momentum [16]

Core Insights - CoreWeave, Inc. (CRWV) is set to report its third-quarter 2025 results on November 10, with a consensus estimate of a loss of $0.39 per share and total revenues expected to be around $1.3 billion [1][6]. Financial Performance - In the second quarter, CRWV's loss narrowed to $0.60 per share from a loss of $1.62 in the same quarter last year, with an adjusted net loss of $131 million compared to $5 million a year ago [3]. - The company anticipates third-quarter revenues between $1.26 billion and $1.3 billion, along with adjusted operating income projected to be between $160 million and $190 million [7][6]. Market Position and Demand - There is a rapid enterprise adoption of AI, leading to explosive demand for CoreWeave's AI cloud services, which is expected to drive strong revenue momentum in the third quarter [5]. - CRWV's revenue backlog increased by 86% year over year to $30.1 billion in the second quarter, bolstered by strategic agreements with OpenAI and a major hyperscaler contract [8]. Strategic Partnerships - CoreWeave has expanded its partnership with OpenAI, resulting in a new $6.5 billion deal that brings the total contract value with OpenAI to approximately $22.4 billion [8]. - The company has also signed a significant agreement with Meta Platforms, potentially worth up to $14.2 billion through December 14, 2031, with options for further expansion [8]. Infrastructure and Capacity Expansion - CoreWeave is rapidly scaling its infrastructure, with plans to exceed 900 MW of active power by year-end, supported by a $6 billion investment in a new AI data center in Lancaster, PA [10]. - The company has a strong focus on expanding its service offerings and capacity to meet growing customer needs in a structurally undersupplied market [10]. Inorganic Growth Strategy - CoreWeave is pursuing strategic acquisitions to enhance its AI platform, including the acquisition of OpenPipe Inc. and Weights & Biases, aimed at accelerating R&D and innovation [12][14]. Stock Performance - CRWV shares have increased by 113.4% over the past six months, significantly outperforming the Zacks Internet Software industry and the broader market [15]. - Despite strong performance, CRWV is considered overvalued with a Price/Book ratio of 21.04X compared to the industry average of 6.22X [17]. Future Outlook - The company is expected to continue leading in key metrics such as power capacity and AI cloud performance, with management anticipating ongoing revenue gains supported by customer commitments [19]. - Investors are encouraged to consider CRWV stock due to strong AI-driven demand and potential for an earnings beat this quarter [20].

Industry Overview - The Internet Software industry is expected to report modest-to-solid revenue growth for Q3 2025, driven by technological innovations in AI, cloud computing, and automation [1][4][10] - Steady demand for AI-powered software solutions, sustained cloud migration, and expanding enterprise IT budgets are anticipated to support this growth [2][3] Key Players and Performance Expectations - Leading companies such as Backblaze (BLZE), Datadog, Inc. (DDOG), JFrog (FROG), Affirm Holdings (AFRM), and Block (XYZ) are expected to benefit from increased adoption and subscription renewals [2][10] - Backblaze's revenues are projected at $36.95 million, reflecting a 13.37% year-over-year increase, driven by strong demand in its B2 Cloud Storage business [9] - Datadog's revenues are estimated at $849.77 million, indicating a 23.15% year-over-year growth, supported by strong momentum in its security and AI-focused offerings [14] - JFrog's revenues are expected to be between $127 million and $129 million, with a year-over-year increase of 17.73% anticipated [17] - Affirm Holdings is projected to report revenues of $885.01 million, representing a 26.7% year-over-year rise [19] - Block's revenues are estimated at $6.34 billion, indicating a 6.12% year-over-year increase [22] Growth Catalysts - AI and generative AI are major growth catalysts, enhancing productivity and customer engagement across various sectors [3] - The expansion of cloud and edge computing capabilities, along with increased data-center investments, is expected to further support revenue growth [3] Challenges - The industry's performance may be affected by macroeconomic factors such as high interest rates and market volatility, which could dampen investor sentiment [4][10] - Companies with strong AI features, solid cloud platforms, and flexible SaaS models are likely to outperform their peers despite these challenges [4]