Traders are bracing for significant fluctuations in CoreWeave’s stock as the company prepares to release its third-quarter earnings report after the market closes on Monday. Options pricing indicates that shares of the cloud computing firm could experience a movement of up to 14% in either direction this week. This range suggests the stock could rise to $118.70, recovering from recent declines, or drop to $89.30, marking its lowest point since early September.
Since going public in March, CoreWeave has reported earnings only twice, and both times the stock reacted negatively despite the company posting impressive growth figures. In May, after announcing a staggering 400% year-over-year revenue increase, shares fell over 2%. Similarly, in August, the stock dropped more than 20% following a report of wider-than-expected losses.
The upcoming earnings release is anticipated with heightened interest as CoreWeave has seen a remarkable surge in revenue driven by the increased demand for AI-enabled cloud computing solutions. During the last quarter, the company secured substantial partnerships, including a $14 billion deal with Meta Platforms and a $6 billion agreement with Nvidia. Additionally, it expanded its existing contract with OpenAI, further fortifying its position in the industry.
Analysts expect CoreWeave to report a third-quarter net loss of $284.4 million, which would be an improvement from the $359.8 million loss in the same quarter last year. Revenue is projected to soar by 120% year-over-year, reaching approximately $1.3 billion.
Sentiment on Wall Street remains mixed, with five out of ten analysts covering the stock rating it as a “buy” while the others maintain a “hold” stance. Their average target price of $158.83 suggests a possible upside of about 53% from Friday’s closing price.
As investors evaluate CoreWeave’s upcoming results, their response will likely reflect broader market sentiment and risk tolerance, particularly surrounding AI-related stocks. With the company’s shares currently down about 30% since its last earnings report, there is speculation that a positive reaction could restore some of the confidence investors have shown since its IPO.