CoreWeave (CRWV), a provider of AI infrastructure, is set to support a new cloud collaboration between Google (GOOGL) and OpenAI, the creators of ChatGPT. As reported, CoreWeave will supply computing capacity to Google Cloud, which will subsequently provide these resources to OpenAI, aligning with the increasing demand for AI services.
This partnership highlights the shifting landscape in the tech industry, where the demand for computing resources has led to collaborations among major cloud providers such as Google, Microsoft (MSFT), and Amazon (AMZN) with emerging companies like CoreWeave. CoreWeave, which gained public status earlier in March, has experienced a remarkable 191% stock price increase in the past month, driven by the booming AI sector. The company recently secured a significant five-year contract worth approximately $11.9 billion with OpenAI and has further extended its partnership with an additional arrangement of up to $4 billion that will last until April 2029.
The collaboration with Google Cloud is expected to enhance CoreWeave’s growth prospects while diversifying its revenue streams, alleviating concerns regarding its revenue concentration from single clients. For instance, Microsoft contributed to 62% of CoreWeave’s revenue in 2024.
Despite the positive projections, analysts have mixed views on CRWV stock, reflected in its Moderate Buy consensus rating. With seven Buy ratings and five Holds, the average price target for CRWV is set at $47.42, suggesting a downside risk of 68.3% from current levels. While some analysts are optimistic about the surge in AI demand, others caution about its high valuation.
This emerging partnership demonstrates the continuous evolution within AI infrastructure, presenting both challenges and opportunities in a rapidly growing market.