Down 53%, Should You Still Buy CoreWeave's (CRWV) Stock?

CoreWeave (NASDAQ: CRWV), a cloud-based provider of AI infrastructure services, went public at $40 per share on March 28, 2025. After dazzling the market with its explosive growth, CoreWeave's stock reached a record high of $183.58 on June 20, 2025.

But today, CoreWeave's stock trades at about $86. Let's see why its stock pulled back, and if that decline represents a good buying opportunity for patient investors.

Image source: Getty Images.

CoreWeave is growing like a weed

CoreWeave was originally an Ethereum mining company, but it repurposed its GPUs to run cloud-based AI tasks after the cryptocurrency market crashed in 2018. By the end of 2022, it had opened three dedicated data centers.

Today, it operates 51 data centers across North America and Europe, and it's installed more than a quarter-million Nvidia (NASDAQ: NVDA) GPUs in its servers to train AI algorithms. Nvidia also owns a 11.5% stake in CoreWeave, making it one of the company's top investors.

By providing only cloud-based computing power via its GPUs, CoreWeave processes AI tasks roughly 35 times faster and 80% more cheaply than cloud infrastructure leaders like Amazon Web Services (AWS) and Microsoft Azure.

That's why its top customers include Meta Platforms, Microsoft, OpenAI, and Anthropic. In 2025, its revenue surged 168% to $5.1 billion, while its adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) grew 154% to $3.1 billion.

For 2026, analysts expect its revenue to rise 151% to $12.9 billion as its adjusted EBITDA surges 144% to $7.5 billion. By the end of the second quarter of 2026, its contracted revenue backlog had expanded 246% year over year to $104 billion, and it expects three-quarters of its revenue this year to be locked into those sticky contracts. That backlog should also keep growing -- and give us plenty of visibility into its future growth -- as the AI boom continues.

But investors shouldn't overlook its weaknesses

CoreWeave's business is firing on all cylinders. However, it's still deeply unprofitable under generally accepted accounting principles (GAAP) -- which includes the interest on its rising debt and depreciation costs for its servers. It repeatedly issued more shares and debt to stay solvent, and it ended its latest quarter with a jaw-dropping debt-to-equity ratio of 14.3.

As interest rates rise and the AI leaders adopt a more cautious approach to expanding their platforms, CoreWeave's expenses could overwhelm its slowing top-line growth. But for now, analysts still expect CoreWeave's revenue and adjusted EBITDA to grow at CAGRs of 101% and 110%, respectively, from 2025 to 2028. Those are incredible growth rates for a stock that trades at just 12 times this year's adjusted EBITDA. So while it's a risky and volatile stock, it looks like a compelling turnaround play after its 50% pullback.

Leo Sun has positions in Amazon and Meta Platforms. The Motley Fool has positions in and recommends Amazon, Ethereum, Meta Platforms, Microsoft, and Nvidia. The Motley Fool has a disclosure policy.