CoreWeave soars 20% as CEO reaffirms AI compute demand after strong Q3 report

CoreWeave shares jumped 20% Wednesday after the neocloud posted quarterly earnings that beat estimates and raised its guidance for the year.

"Demand for the infrastructure is and remains overwhelming." CEO Michael Intrator told CNBC's "Squawk on the Street" Wednesday.

"I think I said that we are 10x oversubscribed to the existing capacity that we have left in 2027, and we are multiples ... oversubscribed on the capacity we have out in 2028," he said.

Neoclouds such as CoreWeave, Nebius and IREN have come under scrutiny this month as investors assessed the sustainability of the AI trade. CoreWeave, in particular, sparked alarm when spreads on its CDS widened past 11%, generally viewed as a distress level, as investors have to pay up for protection against default.

Revenue jumped 168% to $3.7 billion in the third quarter, the company said in a Tuesday statement.

The three months to Sept. 30 marked a "breakout quarter" for CoreWeave, CEO Michael Intrator said, adding that growth was supported by multiple sources of funding, including financing backed by customer contracts and around $9 billion in customer prepayments and deposits.

Other neclouds also rose on CoreWeave's strong results, with Nebius up 12%, Applied Digital up 6% and Iren up 6% after the open.

CoreWeave expects $1.275 billion to $1.375 billion in adjusted operating income on $13 billion to $13.3 billion in revenue. Analysts surveyed by Visible Alpha were looking for $1.07 billion in adjusted operating income, and analysts polled by LSEG had expected $12.86 billion in 2026 revenue.

The neocloud has done well to allay concerns about financing by moving away from unsecured bond financing, Zacks Chief Equity Strategist John Blank told CNBC's "Squawk Box Europe."

"It might be the bottom for CoreWeave," Blank said Wednesday. "But the shares are so beaten up, you have to believe at this point there's more value on the upside than the down."