US Stocks: CoreWeave Shares Plunge 15% as Doubling Capex Raises Margin Concerns

Shares of CoreWeave fell about 15% on Friday after the company’s plans to double capital expenditures this year fueled investor concerns about pressure on margins and the effective returns from its artificial intelligence efforts. If current losses hold, CoreWeave is expected to lose more than $8 billion in market value. The cloud infrastructure company has invested significant capital in building large data centers filled with the best Nvidia chips to take advantage of the booming demand for AI services.CoreWeave has budgeted $30 billion to $35 billion in capital expenditures this year, more than double the $14.9 billion it spent in 2025. The increased spending will put some “short-term pressure on margins” in the near term, the company said.

“The share price reaction suggests that while markets understand CoreWeave’s plan to accelerate spending and prioritize speed and market share, they are concerned about the long-term economics and how the company plans to finance the investment,” said Russ Mould, investment director at AJ Bell.

The company’s rising spending mirrors that of hyperscale cloud providers like Alphabet’s Google and Amazon, which have collectively committed more than $600 billion this year to build out AI infrastructure.

However, unlike these Big Tech companies, neoclouds like CoreWeave and peers Nebius lack the massive cash reserves, leaving them exposed to significant market downturns.

According to their most recent earnings reports, CoreWeave had $3.13 billion in cash and equivalents, compared to Microsoft’s $24.3 billion and Amazon’s $86.8 billion. Amsterdam-based Nebius earlier this month reported a sharp increase in capital expenditure to $2.1 billion in the December quarter, compared with just $416 million in the same period last year.

Neoclouds provide hardware and cloud capacity as services to other technology companies, usually by providing access to high-performance processors and cloud infrastructure.