CoreWeave Third Quarter 2026 Earnings Call - COREWEAVE INC

Explicit Guidance:

• FY2026 Revenue: Raised to $13.0–13.3 billion.
• FY2026 Adjusted Operating Income: Raised to $1.275–1.375 billion (midpoint up 26% year-over-year).
• FY2026 CapEx: Raised to $37–39 billion (low end increased from $35B) to deploy infrastructure sooner than planned.
• Q4 2026 Interest Expense: Expected to be $1.05–1.15 billion.
• FY2026 ARR: Exited 2026 with an annualized run rate of $20–21 billion.
• FY2027 EBITDA: Expected to more than double (excluding benefits of prepayments).
• FY2027 Parent-Level Capital: Expect to raise less than $5 billion in incremental parent-level capital through 2027.
• 2028 Profitability: Expect adjusted net loss to reduce meaningfully in 2027, reaching adjusted net income positivity in the first half of 2028 and for the full year 2028.

Business-Segment Outlook:

• Backlog & Capacity: Revenue backlog stands at $133 billion; active power expected to exceed 1.85 gigawatts by year-end 2026 (doubling the footprint since start of year). 50%+ of backlog expects delivery commencement by end of 2026.
• Renewals Pipeline: 130,000 GPUs coming off contract in 2027 and 170,000 in 2028; 2027 renewals projected to generate ~$4 billion in incremental annualized revenue with zero additional CapEx, growing to nearly $10 billion when including 2028 renewals.
• Managed Inference: Platform exceeded $250 million in booked ARR; growth constrained by allocated capacity.
• Product Mix: 70% of new cloud customers added in Q3 were existing "CoreWeave Forge" users; 10% of Fortune 500 companies now customers; >50% of new customers from industries outside AI labs/tech.
• Contract Types: Pricing for 4-5 year contracts moving to $20–25 million per megawatt annually; short-term capacity selling at >$40 million per megawatt annually.
• Capital Intensity: Expect capital intensity to lower as infrastructure comes off contract, paid-off, and generates revenue without new investment.

Market and Competitive Outlook:

• Supply/Demand: 10x qualified demand relative to available capacity through end of 2027; 2028 demand is several times larger than available capacity even without formal market entry.
• Pricing Trends: Pricing power remains strong with increases continuing in Q4, offsetting cost increases; short-term pricing up to $40M/MW.
• Industry Dynamics: Management anticipates demand for compute growing faster than infrastructure delivery capacity; "sold out" through 2027 with infrastructure placed in 2028 market being sold prior to availability.
• Competitive Position: Differentiation via software layer (Forge) and scale; positioned to benefit from volatility in less-established AI clouds and potential consolidation.
• New Hardware: First cloud to bring NVIDIA Rubin (Rubin) architecture to production; expanding deployment of Vera CPU racks.

Macro / Industry Outlook:

• Regulatory Environment: No anticipated impact from U.S. regulatory shifts on existing permitting/construction; strategy to build responsibly and diversify globally (e.g., Indonesia, India, Spain, Denmark, Canada) to mitigate regional risks.
• Capital Markets: Unsecured debt market deemed too expensive at current yields; will not use unsecured parent debt for funding through 2027. Asset-level secured debt market remains robust.
• Cost of Capital: Weighted average cost of debt at end of Q3 was 7.9% (down 250 bps YoY); new investment-grade facilities expected to price at 7–7.5% yield (225–550 bps over SOFR).
• Economic Environment: Discipline in CapEx allows calibration to market conditions; "success-based" model ties investment to contracted demand.

Strategic Initiatives:

• CoreWeave Forge: Platform launch (September) to unify AI development capabilities; expanding access to enterprise customers.
• Global Expansion: Strategic priority to reach 1.3 gigawatts of contracted power outside the U.S. (totaling 4.6 gigawatts contracted power); entering markets in Indonesia, India, Denmark, and Spain.
• CoreWeave Omni: New lever to monetize third-party infrastructure with lower capital intensity; first customer signed, targeting customers who wish to retain direct ownership.
• Financing Structure: Majority of 2027 CapEx tied to investment-grade/enterprise customers; >75% of remaining committed CapEx secured via Delayed Draw Term Loans (DDTL) matching specific contracts.
• Debt Repayment: Already paid down >$4 billion of debt; long-term facilities allow debt to be fully repaid by contract end, leaving infrastructure owned free and clear.

Risks and Headwinds to Outlook:

• Supply Chain/Regulatory: Supply constraints or delays in data center construction (mitigated by fully permitted sites); potential regulatory impacts on construction pace.
• Market Normalization: Risk of supply/demand normalization if industry build-outs slow, potentially affecting pricing longevity (though management believes demand will outpace supply).
• Execution Risk: Dependence on successful conversion of contracted power to active revenue and ability to deploy infrastructure on schedule.
• Financing Costs: Reliance on secured debt markets; unsecured parent-level funding avoided due to current yields.
• Technology Obsolescence: GPU depreciation cycles; management views this positively as fully paid-off infrastructure yields higher margins post-depreciation.

Management Tone on the Future:

• Confidence Level: Highly confident, describing the business as "resilient," "well-positioned," and at an "inflection point" toward durability.
• Discipline: Emphasis on "optimal economic choice" and "spending discipline" with ability to accelerate or moderate growth pace based on market conditions.
• Strategic Patience: Willing to delay market entry for 2028 capacity to ensure better economic output and pricing.
• Narrative: Shift from "growth at all costs" to "profitable scale"; focus on becoming a "steward of capital" with a "success-based" model.

Miscellaneous:

• Prepayments: Expecting ~$9 billion in prepayments/deposits in the next three months, including >$3 billion for existing, fully paid-off infrastructure.
• Liquidity: $6.5 billion in cash/equivalents + nearly $5 billion undrawn DDTL capacity; $9 billion in prepayments arriving soon.
• Customer Concentration: 70% of new Q3 customers were existing Forge users; 10% of Fortune 500 clients; >2.5x increase in commitments >$100M YoY.