U.S. AI technology stocks, which had plunged amid concerns over debt burdens and the AI investment bubble, rebounded across the board following CoreWeave’s earnings release. Market unease eased as CoreWeave presented stronger-than-expected revenue growth and measures to raise funding, while Nvidia shares, which had plummeted amid controversy surrounding CEO Jensen Huang, returned to an upward trend.
Reuters, Bloomberg and other outlets reported on the 11th (local time) that CoreWeave’s third-quarter earnings results led to a rebound in U.S. technology stocks. CoreWeave shares soared 24.7% that day, while AI infrastructure companies such as Nebius (15.4%) and Applied Digital (7.4%) also rose in tandem.
Nvidia rose 2.87%, recovering from its steep decline over the past two days. The Nasdaq Composite and S&P 500 gained 1.60% and 1.31%, respectively, while the Philadelphia Semiconductor Index jumped 5.7%.
What changed the mood of the market was CoreWeave’s performance and outlook. CoreWeave announced on the 10th that third-quarter revenue reached $3.66 billion, up 168% from the same period a year earlier, equivalent to about KRW 4.9 trillion. It also raised its annual revenue forecast from $12 billion–$13 billion to $13 billion–$13.3 billion. Its backlog from secured customer contracts reached $132.5 billion.
CoreWeave had been at the center of the AI investment bubble debate because of the massive borrowing it had used to build data centers. Concerns continued that it would struggle to service its debt if demand for AI computing slowed or GPU rental fees fell. The recent sharp declines in the shares of other neocloud companies were also attributed to these worries.
However, the latest earnings release not only confirmed that demand for AI computing remains strong but also presented specific measures for repaying debt. CoreWeave CEO Michael Intrator said cash flow from existing customer contracts would allow the company to service both current and future debt. He also explained that it would not need to issue new unsecured bonds while accepting high interest rates. The company also expects to turn adjusted profitable in the first half of 2028.
CoreWeave is also changing how it raises funding. It expects to receive about $9 billion in customer prepayments and deposits over the next three months. In particular, more than $3 billion of that amount is related to new contracts for data center facilities already built and can be secured without additional investment in equipment. The company also plans to use customer contracts as loan collateral to reduce its reliance on high-interest borrowing.
Intrator said in an interview with CNBC that day that he had also withdrawn a previously scheduled plan to sell shares he personally held. The move was interpreted as a sign of confidence in the company’s results and funding outlook.
Positive assessments also emerged on Wall Street. An analyst team led by Bernstein’s Madison Lee and others evaluated that CoreWeave had delivered the best quarterly performance one could hope for and that concerns over funding had been largely resolved.
Nvidia’s rebound also drew attention. The company’s market capitalization fell by about $430 billion over two days amid investigations into CEO Huang’s recent personal-life controversy and allegations involving Chinese intelligence agencies. However, investor sentiment improved as CoreWeave, a major customer and investment target, confirmed continued growth in demand for AI computing.Nvidia rose more than 5% during intraday trading before closing 2.87% higher.
CoreWeave’s earnings did not eliminate the financial risks of its AI infrastructure business. The company recorded a net loss of $790 million in the third quarter, with interest expense alone reaching $846 million. According to the Financial Times, CoreWeave is also pursuing additional loans worth billions of dollars, secured by assets such as Nvidia GPUs. In other words, external funding for data center construction continues to be secured.
Morgan Stanley also warned that CoreWeave could be among the first to suffer the biggest blow if the shortage of AI computing capacity is resolved in the future. Nevertheless, the earnings results became a turning point that changed the market’s view of AI infrastructure investment. CoreWeave, which had triggered a sharp plunge in tech stocks due to concerns over excessive borrowing and profitability, led a rebound across AI tech stocks, including Nvidia, by demonstrating the sustainability of its business through actual revenue growth and customer contracts.
Reporter Im Dae-jun ydj@aitimes.com
