CoreWeave has been investing heavily in data centers and Nvidia (NVDA) chips to meet the soaring demand for artificial intelligence computing power.
“CoreWeave is getting stronger every day,” Huang said at a Bloomberg event in Stockholm. “I’m optimistic. Their cost of capital is actually going down.”
Nvidia holds about 47.2 million shares of CoreWeave, accounting for about 10% of the company. CoreWeave is also a major customer of Nvidia chips.
However, Huang’s reassurance failed to sustain the rally.
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In August, CoreWeave reported second-quarter results that beat Wall Street expectations.
The company reported an adjusted loss of $1.03 per share, missing analysts’ expectations for a loss of $1.20. Revenue was US$2.58 billion, an increase of 112% year-on-year, higher than Wall Street’s forecast of US$2.56 billion.
CoreWeave expects third-quarter revenue of $3.4 billion to $3.6 billion, which would imply mid-point growth of 158%. According to CNBC, analysts interviewed had expected US$3.43 billion.
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Analysts recommend buying CoreWeave stock on dips
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Cantor Fitzgerald maintained an overweight rating and $176 price target on CoreWeave stock, recommending investors buy the dip.
As of this writing, CoreWeave shares are trading at about $61.
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