Why CoreWeave Stock Plummeted Today
Key Points
CoreWeave stock sank today following the company's Q1 report.
The company reported stronger-than-expected sales, but its loss was bigger than anticipated.
CoreWeave's forward guidance missed Wall Street's expectations.
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CoreWeave (NASDAQ: CRWV) stock took a hit on Friday following the company's latest earnings report. The artificial intelligence (AI) data-center specialist's share price fell 11.4% in the daily session.
CoreWeave published its first-quarter results after yesterday's market close, posting mixed results. While the company posted sales that came in ahead of expectations, the business posted a wider-than-expected loss. Investors also weren't happy with management's forward guidance.
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CoreWeave's Q1 report wasn't enough to excite investors
CoreWeave recorded a loss per share of $1.40 on sales of $2.08 billion in Q1. For comparison, the average analyst estimate had targeted a per-share loss of $1.2 and revenue of $1.97 billion. Revenue was up 127% year over year, and the company said that it signed more than $40 billion of new service commitments in the quarter. Management said that the business ended the period with an order backlog of nearly $100 billion.
What's next for CoreWeave?
For the current quarter, CoreWeave is guiding for sales to come in between $2.45 billion and $2.6 billion. Unfortunately, that target came in significantly below the average analyst estimate -- which had called for sales of $2.7 billion. Meanwhile, full-year guidance is projected to be between $12 billion and $13 billion. The midpoint of management's full-year guidance range also fell short of the average analyst target for sales of $12.56 billion.
CoreWeave's forward guidance was far from terrible, but there's still a significant degree of uncertainty when it comes to the company's long-term outlook. The company's nearly $100 billion backlog certainly looks encouraging, but there are questions about the debt load and execution going forward.
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Keith Noonan has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.
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