Key Takeaways
- Shares of CoreWeave have plummeted approximately 28% following its Q4 earnings release on February 26
- The company’s Q1 revenue forecast of $1.9B–$2B came in well below the $2.29B analyst consensus
- Full-year FY26 revenue guidance of $12B–$13B marginally exceeded the $12B Street estimate
- Contract backlog surged to $66.8B from $55.6B, representing 342% year-over-year growth
- Citi downgraded its price target to $126 from $135 and revised FY26 EPS forecast to a loss of ($2.97) from profit of $0.75
When CoreWeave unveiled its Q4 results after market close on February 26, the response from Wall Street was immediate and severe.
CoreWeave, Inc. Class A Common Stock, CRWV
Shares plunged as much as 21% during Friday’s trading session following the announcement, with the downturn extending into the subsequent week. By the opening of trading on Tuesday, March 3, CRWV had shed an additional 7%, culminating in a total decline of approximately 28% since the earnings release.
The company posted Q4 revenue of $1.57B, representing 110% year-over-year growth and surpassing analyst projections. However, this positive result was overshadowed by concerning forward guidance.
The company’s Q1 revenue outlook of $1.9B–$2B significantly undershot the Street’s $2.29B consensus expectation, representing the primary catalyst behind investor concerns.
Looking at the full fiscal year, CoreWeave provided FY26 revenue guidance of $12B–$13B, modestly exceeding the $12B analyst average. The company’s contract backlog expanded from $55.6B to $66.8B — representing a substantial 342% year-over-year increase.
Mounting Losses and Capital Spending Concerns
The company’s Q4 net loss totaled $284M, a dramatic escalation from the $36M loss recorded in the year-ago period. Loss per share registered at $0.89, significantly worse than the anticipated $0.21 loss.
Interest expense for the quarter ballooned to $388M from $149M in the prior-year period. This represents a substantial headwind to any near-term profitability trajectory.
The company elevated its FY26 CapEx guidance to $30B–$35B, representing more than a doubling of the $14.9B deployed in FY25.
CEO Michel Intrator defended the substantial capital expenditure increase during the company’s earnings conference call. He emphasized that the deployment is directly linked to contracted customer demand, referencing the $66.8B backlog as justification.
Intrator also stated that all new capacity contracts are projected to start generating revenue before the close of 2026.
Approximately 70% of the backlog is attributed to financially sound, lower-risk enterprise customers. The company’s two primary clients are Meta and Microsoft, both of which have announced plans for substantial CapEx increases throughout the current year.
OpenAI, representing another significant customer, secured a $110B financing round last week, alleviating some investor concerns regarding circular funding arrangements.
CoreWeave concluded FY25 with 850 MW of operational power capacity. Contracted power capacity reached 3.1 GW. Management targets 1.7 GW of active power deployment by year-end 2026, with a longer-term goal of 5 GW in contracted capacity by 2030.
Analyst Reactions and Revised Forecasts
Citi Research responded promptly following the results, implementing sweeping estimate reductions.
Analyst Tyler Radke revised the FY26 EPS projection to a loss of ($2.97) from a previously anticipated profit of $0.75, and adjusted the FY27 EPS forecast to a loss of ($1.74) from an expected gain of $3.11.
Citi also reduced its CRWV price objective to $126 from $135.
The firm explained it aligned Q1 revenue and operating income projections with management guidance, considering the Q4 shortfall and the fact that Q1 guidance was issued with approximately two-thirds of the quarter already completed.
Prior to the post-earnings decline, CRWV traded at a forward EV/Sales multiple of 12.56x. That valuation metric has since contracted to approximately 5–6x based on 2026 revenue projections.
Interestingly, the stock had gained roughly 9% the Tuesday preceding the earnings announcement, buoyed by Trump’s State of the Union address, only to surrender those gains and substantially more in the aftermath.
