CoreWeave Is at the Center of the AI Revolution, and Its IPO looks Like a House of Cards

Today, CoreWeave began trading on the stock market, and it is looking like an inauspicious start for the AI sector. The company had initially hoped to sell shares for $47 to $55 a piece, but began trading at $39 despite being propped up by Nvidia with a massive $250 million order at $40 per share. When you look under the hood, CoreWeave is a dog of a company, with business fundamentals that raise a lot of questions, explaining the less than enthusiastic demand by investors. CoreWeave in recent years found itself in something of an enviable position. Starting out in 2017, it bought GPUs to supply to the cryptocurrency mining industry, only to pivot to AI when that became the hot new trend. CoreWeave is fundamentally a picks and shovels business: It supplies GPUs to an industry that has desperately sought them. Unfortunately though, it appears that the industry does not need them as much today. CoreWeave is going public just as its biggest customer, Microsoft, has pulled back on spendi ... Read full article.