CoreWeave faces profitability expansion doubts as the market focuses on its capital expenditures.

Jin10 Data, November 10th: Cloud computing company CoreWeave’s stock price plummeted 22% last week. Now, investors are closely watching CoreWeave’s performance as concerns grow over high expenditures by companies like Meta and Microsoft (MSFT.O), as well as the cyclicality of many AI deals centered around OpenAI announced in recent weeks. Most of CoreWeave’s revenue comes from Meta, Microsoft, and Alphabet. Dave Mazza, CEO of Roundhill Financial, said, “Investors are becoming more sensitive to the balance between growth and spending. Doubling revenue is great, but if capital expenditures rise faster, this math can’t last forever.” CoreWeave has faced questions about the cyclicality of its business model, debt burden, and reliance on a few major clients. The company expects its revenue this quarter to approach $1.3 billion, more than double the same period last year, with an adjusted loss of 36 cents per share, compared to a loss of 53 cents in the second quarter, attributed to its rising capital expenditures.