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CoreWeave's $35-$39B Capex Plan: Can AI Demand Justify the Spend?
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Key Takeaways
CoreWeave lifts 2026 capex to $35-$39B as it expands AI infrastructure to meet rising demand.
Backlog hit $104.2B, up 246% year over year, excluding over $25B of early third-quarter commitments.
CoreWeave has secured over $32B in debt and equity financing year to date to fund expansion.
CoreWeave (CRWV - Free Report) is aggressively expanding its AI infrastructure to meet increasing customer demand, necessitating massive capacity additions. 2026 capital expenditures are now projected to be between $35 billion and $39 billion (up from $31-$35 billion), indicating the scale of its AI infrastructure ambitions.
Second-quarter revenues of $2.6 billion jumped 112% year over year and 24% sequentially. Backlog reached $104.2 billion, surging 246% year over year. This does not include more than $25 billion of net new customer commitments secured in the early third quarter.
To support these long-term commitments, CoreWeave is rapidly expanding its infrastructure footprint. At second-quarter end, it had 1.5 gigawatts of active power, after adding nearly 500 megawatts during the quarter. Contracted power was 4.2 gigawatts, offering visibility toward the company’s goal of at least 8 gigawatts by 2030.
However, such enormous capex does create financial pressure. Capex was $9.4 billion, while construction in progress increased sequentially to $11.9 billion in the second quarter. Management noted that capex is front-loaded, requiring a combination of debt, customer prepayments and other corporate-level capital to fund buildouts.
Operating expenses reached $2.6 billion, including $165 million in stock-based compensation, due to ramping of active power and backlog conversion. The infrastructure buildout has led to an interest expense of $640 million, compared with $267 million a year earlier. Interest expense is expected to climb further to $860-$940 million in the current quarter, due to increasing debt.
To fund expansion, CoreWeave has secured more than $32 billion in debt and equity capital financing year to date.
Whether this aggressive capex spend proves to be a growth driver or a massive risk depends on CoreWeave’s execution, financing costs and capacity monetization.
Challenges for CRWV remain significant amid intense competition from rivals such as pure-play Nebius Group N.V. (NBIS - Free Report) and tech behemoths like Microsoft (MSFT - Free Report) , Amazon and others, which are also aggressively ramping up capacity.
Capex Plans for Other Players in the AI Infra Space
Nebius is another rapidly growing AI infrastructure company. As it doubles down on AI infrastructure, NBIS has set an ambitious $20-$25 billion capex plan for 2026. The company spent nearly $5.7 billion as capex in the second quarter for buying GPUs, GPU-related hardware and for expansion of its data center footprint.
Management noted that nearly 70% of second-quarter deals included upfront prepayments, and customer prepayments are expected to provide more than $9 billion of funding in 2026. For recently signed deals, upfront payments cover about 50-60% of capex, thereby reducing dependence on debt and equity.
Microsoft is a structurally dominant force in the tech space. MSFT’s capex spending dwarfs spending for both NBIS and CRWV. Fourth-quarter fiscal 2026 capex stood at $41 billion, with about two-thirds of that spend going toward CPUs and GPUs, and the rest was for long-lived assets. Management has guided capex to exceed $50 billion in the first quarter of fiscal 2027 and projects the full-year capex to increase year over year, supported by demand signals across its portfolio. Meanwhile, following a lease-accounting-related shift, Microsoft has now put its calendar 2026 capex expectation at approximately $175 billion.
Microsoft added 31 data centers across five continents during the quarter and another gigawatt of capacity, while expecting to double overall capacity within two years.
CRWV Price Performance, Valuation and Estimates
Shares of CoreWeave have surged 34.8% over the past month compared with the Internet Software industry’s growth of 1.6%.
Image Source: Zacks Investment Research
In terms of forward price/sales multiple, CRWV’s shares are trading at 2.49X, lower than the Internet Software industry’s ratio of 4.05X.
Image Source: Zacks Investment Research
The Zacks Consensus Estimate for CRWV’s earnings for 2026 has been revised downward over the past 60 days.
View the Zacks #1 Rank List
Image: Bigstock
CoreWeave's $35-$39B Capex Plan: Can AI Demand Justify the Spend?
Key Takeaways
CoreWeave (CRWV - Free Report) is aggressively expanding its AI infrastructure to meet increasing customer demand, necessitating massive capacity additions. 2026 capital expenditures are now projected to be between $35 billion and $39 billion (up from $31-$35 billion), indicating the scale of its AI infrastructure ambitions.
Second-quarter revenues of $2.6 billion jumped 112% year over year and 24% sequentially. Backlog reached $104.2 billion, surging 246% year over year. This does not include more than $25 billion of net new customer commitments secured in the early third quarter.
To support these long-term commitments, CoreWeave is rapidly expanding its infrastructure footprint. At second-quarter end, it had 1.5 gigawatts of active power, after adding nearly 500 megawatts during the quarter. Contracted power was 4.2 gigawatts, offering visibility toward the company’s goal of at least 8 gigawatts by 2030.
CoreWeave Inc. Price, Consensus and EPS Surprise
CoreWeave Inc. price-consensus-eps-surprise-chart | CoreWeave Inc. Quote
However, such enormous capex does create financial pressure. Capex was $9.4 billion, while construction in progress increased sequentially to $11.9 billion in the second quarter. Management noted that capex is front-loaded, requiring a combination of debt, customer prepayments and other corporate-level capital to fund buildouts.
Operating expenses reached $2.6 billion, including $165 million in stock-based compensation, due to ramping of active power and backlog conversion. The infrastructure buildout has led to an interest expense of $640 million, compared with $267 million a year earlier. Interest expense is expected to climb further to $860-$940 million in the current quarter, due to increasing debt.
To fund expansion, CoreWeave has secured more than $32 billion in debt and equity capital financing year to date.
Whether this aggressive capex spend proves to be a growth driver or a massive risk depends on CoreWeave’s execution, financing costs and capacity monetization.
Challenges for CRWV remain significant amid intense competition from rivals such as pure-play Nebius Group N.V. (NBIS - Free Report) and tech behemoths like Microsoft (MSFT - Free Report) , Amazon and others, which are also aggressively ramping up capacity.
Capex Plans for Other Players in the AI Infra Space
Nebius is another rapidly growing AI infrastructure company. As it doubles down on AI infrastructure, NBIS has set an ambitious $20-$25 billion capex plan for 2026. The company spent nearly $5.7 billion as capex in the second quarter for buying GPUs, GPU-related hardware and for expansion of its data center footprint.
Management noted that nearly 70% of second-quarter deals included upfront prepayments, and customer prepayments are expected to provide more than $9 billion of funding in 2026. For recently signed deals, upfront payments cover about 50-60% of capex, thereby reducing dependence on debt and equity.
Microsoft is a structurally dominant force in the tech space. MSFT’s capex spending dwarfs spending for both NBIS and CRWV. Fourth-quarter fiscal 2026 capex stood at $41 billion, with about two-thirds of that spend going toward CPUs and GPUs, and the rest was for long-lived assets. Management has guided capex to exceed $50 billion in the first quarter of fiscal 2027 and projects the full-year capex to increase year over year, supported by demand signals across its portfolio. Meanwhile, following a lease-accounting-related shift, Microsoft has now put its calendar 2026 capex expectation at approximately $175 billion.
Microsoft added 31 data centers across five continents during the quarter and another gigawatt of capacity, while expecting to double overall capacity within two years.
CRWV Price Performance, Valuation and Estimates
Shares of CoreWeave have surged 34.8% over the past month compared with the Internet Software industry’s growth of 1.6%.
Image Source: Zacks Investment Research
In terms of forward price/sales multiple, CRWV’s shares are trading at 2.49X, lower than the Internet Software industry’s ratio of 4.05X.
Image Source: Zacks Investment Research
The Zacks Consensus Estimate for CRWV’s earnings for 2026 has been revised downward over the past 60 days.
Image Source: Zacks Investment Research
CRWV currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.