Unlock the Editor’s Digest for free
Roula Khalaf, Editor of the FT, selects her favourite stories in this weekly newsletter.
CoreWeave is planning to slash the size and value of its initial public offering and bring in Nvidia as an anchor investor, another sign of wavering investor demand for artificial intelligence infrastructure on Wall Street.
The cloud computing provider will formally set the price of its shares later on Thursday and is expecting to pare back its offering to about $1.5bn, according to people close to the matter.
CoreWeave had initially targeted raising $4bn and dropped that figure to $2.7bn when it began a roadshow to generate interest for its shares last week. The people said the size and price of the deal could still change before the IPO on Thursday evening.
Nvidia, which already owns about 6 per cent of CoreWeave, would buy an undisclosed chunk of shares at the IPO, the people said. Nvidia is also one of CoreWeave’s largest suppliers and among its biggest customers.
CoreWeave now plans to sell about 37.5mn shares at around $40 a piece, the people added, having initially hoped to sell about 49mn shares for between $47 and $55 per share. The new price would give the company a market value of around $23bn. The company will begin trading on Nasdaq in New York on Friday morning.
The reductions mark a dramatic climbdown for what is still expected to be one of the biggest tech listings of the year. CoreWeave was last valued at $23bn in its most recent private market valuation in October 2024. Initial discussions with its bankers sought to value the company at more than $35bn in the IPO.
CoreWeave declined to comment.
Thursday’s share sale is being closely watched as a signal that a years-long frozen period for tech IPOs is over. Fintech start-ups Klarna and Chime, retail trading platform eToro and ticketing group StubHub have also filed for IPOs and are expected to list in the next two months.
US natural gas exporter Venture Global, which was billed as a blockbuster IPO, has fallen more than 50 per cent since it went public in late January.
The Financial Times this week reported that CoreWeave violated several key terms of a $7.6bn loan last year, triggering a series of so-called technical defaults.
The New Jersey-based company has attracted intense scrutiny in recent weeks for its large debt burden, close relationship with Nvidia and forthcoming maturities on billions of dollars of loans. CoreWeave’s largest customer, Microsoft, walked away from some of its commitments to the company, the FT reported this month. CoreWeave denied that contracts had been cancelled.
Friday’s planned listing comes as the Trump administration’s aggressive trade agenda has roiled US equity markets in recent weeks, hitting shares in tech companies particularly hard.
The Philadelphia Semiconductor index, an index tracking 30 of the world’s biggest semiconductor manufacturers, has lost 11 per cent this year. Nvidia has slipped 16 per cent over the same period.
Alibaba chair Joe Tsai on Tuesday warned of a potential “bubble” emerging in data centre construction, further denting investor sentiment in the middle of CoreWeave’s pre-IPO investor roadshow. JPMorgan, Morgan Stanley and Goldman Sachs are acting as lead underwriters on the deal.
Read the full article here
