CoreWeave Stock Drops 16% Amid Speculation of Core Scientific Data Center Delays

• CoreWeave faces setbacks from a single data center provider, impacting expansion plans amid high demand for GPU computing.

• Revenue surged 134% year-over-year, but 2025 forecasts fell short of analyst expectations, leading to a stock decline.

• The company’s $56 billion backlog highlights strong AI demand, with deals from Meta and OpenAI underscoring growth potential despite delays.

Discover why CoreWeave stock dropped 16% due to data center delays linked to Core Scientific. Explore revenue growth, analyst reactions, and future outlook in AI infrastructure. Read now for key insights.

What Caused CoreWeave’s Recent Stock Decline?

CoreWeave’s stock decline was primarily triggered by revelations during the company’s third-quarter earnings report about delays in data center development from a third-party provider. CEO Mike Intrator emphasized that the issues stemmed from one specific partner, affecting only a portion of the company’s expansive infrastructure plans. This disclosure, combined with a downward revision in 2025 revenue guidance, led to a 16% drop in shares on Tuesday, reflecting investor unease over potential bottlenecks in scaling AI computing resources.

How Are Data Center Delays Affecting CoreWeave’s Operations?

The data center delays have introduced challenges to CoreWeave’s aggressive expansion strategy, particularly in meeting the surging demand for high-performance computing essential for AI workloads. According to reports from CNBC, CEO Mike Intrator described the setback as isolated to a single provider, insisting it impacts just one out of 41 data centers in the portfolio. During the earnings call, analysts from JPMorgan Securities pressed for details, but Intrator avoided naming the partner outright, though speculation points to Core Scientific, a firm CoreWeave previously sought to acquire for $9 billion—a deal rejected by shareholders earlier this year.

To mitigate the slowdown, CoreWeave deployed its own teams onsite alongside contractors to accelerate construction and readiness. Intrator noted that these efforts, initiated after noticing third-quarter lags, aim to prevent further slippage in capacity rollout. CFO Nitin Agrawal reinforced this by attributing the issue to “a single provider, data center provider partner,” underscoring the company’s commitment to resolving it without derailing overall progress. Importantly, the delays are not expected to jeopardize the $56 billion contract backlog or the realization of signed agreements, which include major expansions with clients like Meta and OpenAI.

Core Scientific’s involvement adds a layer of complexity, given its role in Bitcoin mining and data center hosting. Facilities in Texas, Oklahoma, and North Carolina—linked to Core Scientific—were highlighted in discussions, and the company’s shares also fell 10% on the same day. JPMorgan analysts, while downgrading CoreWeave to Neutral with a reduced price target from $135 to $110, maintain a positive long-term view, citing resilient demand for GPU resources in AI training and development. They project revenue recovery in early 2026 once infrastructure hurdles are cleared, supported by industry data showing AI compute needs growing at over 100% annually.

Frequently Asked Questions

What is the connection between CoreWeave and Core Scientific?

CoreWeave attempted a $9 billion acquisition of Core Scientific earlier this year, which was voted down by shareholders. Recent data center delays at CoreWeave are speculated to involve Core Scientific as the third-party provider, though CEO Mike Intrator has not confirmed this. Both companies operate in high-compute environments, with Core Scientific’s expertise in mining infrastructure overlapping CoreWeave’s AI needs.

Will CoreWeave’s data center delays impact its major AI contracts?

According to CoreWeave’s leadership, the delays should not affect the company’s backlog or contract fulfillment. With onsite teams working daily to advance projects, the focus remains on delivering capacity for key partners like Meta’s $14.2 billion deal and OpenAI’s expanded $22.4 billion agreement. The isolated nature of the issue supports timely execution of these high-value commitments.

Key Takeaways

• Revenue Growth Amid Challenges: CoreWeave achieved a 134% year-over-year revenue increase to $1.36 billion in Q3, demonstrating strong AI demand despite operational hurdles.
• Guidance Adjustment: The 2025 revenue forecast of $5.05-5.15 billion is below analyst estimates, contributing to the stock drop and a JPMorgan downgrade to Neutral.
• Resilient Backlog: A $56 billion contract pipeline, bolstered by new clients like CrowdStrike and Rakuten, positions CoreWeave for recovery once delays resolve—monitor infrastructure updates for investment decisions.

Conclusion

In summary, CoreWeave’s stock decline stems from data center delays linked to a third-party provider, potentially Core Scientific, alongside tempered 2025 guidance despite impressive quarterly revenue. The company’s robust backlog and strategic onsite interventions signal resilience in the competitive AI infrastructure landscape. As bottlenecks ease, CoreWeave remains poised to capitalize on escalating demand for GPU computing, offering investors a compelling long-term opportunity in emerging technologies.