CoreWeave Scores Nine Years of Guaranteed Sales… Courtesy of Daddy Jensen’s Credit Card

While Nvidia is getting ratio’d by Chinese regulators over a 2020 deal (seriously, five years later… we’ve had three different Spider-Mans since then), CoreWeave is out here pulling a Jayden Daniels-style rookie season. The stock has already tripled since its March IPO and jumped another 7% today after Jensen Huang promised them another $6.3 billion in business.

This deal is about as good as it gets. Nvidia legally obligated itself to buy CoreWeave’s extra server capacity through 2032. That’s nine years of guaranteed cash flow. Nine years of Jensen saying: “don’t worry sweetie, if Microsoft ghosts you, I’ll still cover dinner.” Veterans on Wall Street would call this a de-risking masterclass. To the rest of us, it looks like corporate nepotism on HGH. (But let’s keep it 100… if your biggest investor also wants to be your biggest customer, you don’t argue. You cash the check and run.)

If you’re not familiar with CoreWeave’s business model, they’re pretty much the StubHub of GPUs. They buy up Nvidia chips, jam them into data centers, and then rent out compute power to the next “revolutionary” AI startup trying to emulate ChatGPT. OpenAI already dropped $11.9 billion on them earlier this year, plus another $4 billion extension through 2029. Microsoft is a client too. And with Nvidia now guaranteeing to “buy the leftovers,” CoreWeave is effectively invincible against demand dips. It’s like running a concert venue where Coldplay promises to buy every unsold ticket.

(Source: Reuters)

Somehow even with Daddy Jensen paying all the bills… CoreWeave’s financials are still diabolically bad. Last quarter revenue jumped 207% year-over-year to $1.21 billion… but expenses expanded to nearly 4x and they posted a $290 million net loss. But in AI, losses are being reframed as “growth investments”... a story Wall Street is more than willing to buy as long as the top line keeps exploding.

The result is a $58 billion valuation after just six months on the market. That’s wild when you realize CoreWeave isn’t so much a standalone business as it is an appendage of Nvidia. Their revenues, contracts, and future expansion are all bolted to Jensen’s ability to keep the GPU faucet running. If Nvidia raises prices, misses production, or sneezes in the wrong direction… CoreWeave feels it tenfold. But for now, investors are ignoring all the red flags.

At the time of publishing this article, Stocks.News holds positions in Microsoft as mentioned in the article.