By Deborah Mary Sophia
Nov 10 (Reuters) - CoreWeave said on Tuesday it would become profitable on an adjusted basis in the first half of 2028, as the AI cloud company sought to reassure investors that strong
demand and customer commitments will support its debt-fueled expansion.
Shares of the Nvidia-backed company were up 5% in extended trading after it also said it does not see any material risks to its data-center buildout from a potential shift in regulatory landscape after the Democrats' sweeping win in the US midterms.
CoreWeave shares have crashed more than 40% in the past month after the firm emerged as the focal point of growing AI bubble fears, with investors worried about heavy borrowing for setting up data centers against the backdrop of rising interest rates and the pace of returns on the massive investments.
The steep selloff also triggered a broader crisis of confidence in the AI trade. Earlier in the day, AI juggernaut Anthropic kicked off a roadshow for its share sale at a lower target valuation than earlier estimates.
Easing some jitters, CoreWeave said it would not tap unsecured debt markets at current yields and that it had enough cash flow from existing customer commitments to repay current debt and any additional borrowing needed to fulfill those contracts.
CoreWeave had about $46.9 billion in total debt as of the end of September. It expects to raise less than $5 billion in additional capital through 2027.
CEO Mike Intrator said the company had $9 billion in customer prepayments and deposits that will flow in over the next three months.
"Customer contracts come first, and investment follows. Because CoreWeave's investments are tied to committed demand, lenders have something concrete to lend against and customers typically help fund the buildout," he said in a statement.
CoreWeave's revenue backlog stood at $132.5 billion at September-end, rising from $104 billion at the end of June. At the same time, its quarterly capital spending jumped to $14.5 billion from $9.4 billion in the prior quarter.
That spending is necessary to bring capacity online to meet the surging demand, CoreWeave said, as it is largely sold out of capacity through the next year, with about ten times as much demand as available capacity.
NO IMPACT EXPECTED FROM CHANGES IN POLITICAL LANDSCAPE
Investors have been worried about tech companies' data-center expansion plans as they prepare for a tougher regulatory environment after the Democratic win in the midterm elections. Public backlash has already been growing in the US around data centers' impact on local resources including water and power.
"There is going to be a lot more scrutiny on how you build, how you use resources... But I don't think it's going to require a material change in how we go about building our infrastructure. I don't think it's going to materially distort the costs of the buildout," Intrator told Reuters in an interview.
"I do think that there is going to be a pacing issue, as people need to be more transparent and work through the process with the communities and that's going to be prevalent across the industry. But that's how we've done it historically and it has been a hallmark of how we've built our data centers."
Intrator said that CoreWeave will not ramp up international expansion plans because of the election results.
"This is not a new strategy that you've got us building into as a reaction to the elections. This is something that we have been working at diligently for a year and a half already," he said.
CoreWeave now expects 2026 revenue to be between $13.0 billion and $13.3 billion, from $12.4 billion to $13.2 billion earlier.
It also lifted the lower end of its annual spending target by $2 billion, now projecting spending of $37 billion to $39 billion.
CoreWeave's third-quarter revenue surged nearly 170% to $3.66 billion, beating estimates of $3.55 billion, while a per-share loss of 95 cents came in smaller than estimates for a $1.16 loss, according to data from LSEG.
(Reporting by Deborah Sophia in Bengaluru; Editing by Sriraj Kalluvila and Christopher Cushing)
