After the sharp drop in performance, Wall Street's bullish logic remains unchanged: CoreWeave (CRWV.US) has accumulated a backlog of orders worth billions, building a moat, while Wells Fargo & Company has raised its target price against the trend.

Due to lower-than-expected revenue outlook for the second quarter, the stock price of AI cloud computing infrastructure company CoreWeave (CRWV.US) dropped more than 10% in early Friday trading, but analysts maintain a generally positive attitude. CoreWeave provided revenue guidance for the second quarter of 24.5 billion to 26 billion US dollars, with a median value of 25.3 billion US dollars, lower than analysts' consensus expectation of approximately 27 billion US dollars. Adjusted operating profit guidance is only between 30 million and 90 million US dollars, far below the market expectation of about 154 million US dollars. Wall Street remains optimistic about long-term orders and capacity release Wells Fargo & Company maintains its "hold" rating and raises the stock's target price from $135 to $155. The analyst team led by Michael Turrin stated, "Despite the impressive performance in the first quarter, CoreWeave's lower-than-expected guidance for the second quarter and reaffirmed annual guidance make the outlook for the rest of the year complex - this will heavily skew performance towards the first half of the year. However, CoreWeave is still executing consistently, with nearly a billion dollars in backlog orders and over 1GW of active capacity." Jefferies Financial Group Inc. maintains a "buy" rating for the stock with a target price of $160. The analyst team led by Brent Thill stated, "CoreWeave delivered a strong first quarter, signing over $40 billion in new committed orders, and revenue exceeded consensus expectations by 5%. While the market is still concerned about the substantial increase in adjusted EBIT in the second half of the 2026 fiscal year (8.1 million US dollars for the first half, 0.919 billion US dollars for the second half) and the approximately 500 million US dollar increase in the midpoint of the 2026 capital expenditure guidance due to component pricing pressure, we see extremely high visibility from the signed backlog orders (average duration of 5 years), and cost pass-through effects support long-term profit margins. The current $59 billion market cap corresponds to $99 billion in remaining performance obligations (RPO) and a scale of AI infrastructure construction worth trillions of dollars." Analysts stated that revenue backlog is as high as $99.4 billion, higher than the $66.8 billion in the previous quarter. While this is only slightly higher than some people's expectations, analysts pointed out that the signing of over $40 billion in new committed orders by CoreWeave (along with RPO converging towards revenue backlog orders) was better than expected. Analysts also noted that the backlog orders were becoming diversified, with backlog orders in the financial services sector nearing $10 billion, and the company also indicated that commitments from 10 customers exceeded $1 billion. In addition, analysts pointed out that pricing for various generation products remains strong. With the growth in inference demand, the demand for NVIDIA Corporation's Blackwell, Hopper, and Ampere architecture is expanding. CoreWeave stated that the average pricing for A100, H100, H200, and L40 has all increased compared to the previous period, and the recent cluster capacity is still sold out. The rise of CoreWeave is essentially a textbook case of deep integration with the NVIDIA Corporation ecosystem. During the previous period of extreme shortage of AI computing power, the company quickly secured a position by forward-looking large-scale purchases (especially of H100 chips) and a close partnership with NVIDIA Corporation, becoming a "lifeline" for many tech companies eager to train large models but unable to obtain sufficient quotas from comprehensive cloud giants. This focus strategy of a "pure GPU cloud" has given it a differentiated advantage over comprehensive cloud providers like AWS, Azure: customers can get ultimate performance and less bundled services here. Now, the revenue backlog of up to $99.4 billion is the most direct proof of its ecosystem value. With an average contract term of five years, and heavyweight players with commitments exceeding $1 billion appearing in the customer list, it signifies that its services have penetrated from startups to large Financial Institutions, Inc. (the backlog orders in this sector are nearly $10 billion). This builds its "moat" of short-term visibility. However, deep integration is a double-edged sword. Its business model heavily relies on NVIDIA's chip supply roadmap and pricing strategy. As the industry shifts from training to inference, demand is spreading to Blackwell, Hopper, and even earlier Ampere architectures, can CoreWeave continue to maintain its purchasing advantage and cost pass-through ability? Once NVIDIA Corporation adjusts its partner strategy or directly increases its investment in cloud services, CoreWeave's barriers will be directly impacted. Finally, there is the "time game" of revenue recognition. The $99 billion in RPO is not immediate revenue, it takes several years to convert into reported income. Market concerns lie in whether these 5-year contracts conceal the risk of customers renegotiating or even canceling orders due to changes in technology routes? Especially when some orders may be highly concentrated among a few top AI companies, this risk is more prominent. "The hockey stick" performance challenge The core pain point of CoreWeave's stock price decline lies in its extremely unbalanced annual performance distribution. Jefferies Financial Group Inc. pointed out a brutal expectation: adjusted EBIT for the first half of 2026 is only $81 million, while it is required to skyrocket to $0.919 billion in the second half. This almost exponential growth heavily relies on the concentrated delivery and placement of several large orders in the second half of the year. The uncertainty of whether this can be perfectly executed exists. This also explains why the market responded with a significant drop when the Q2 guidance was slightly below expectations - investors' tolerance for execution risk is decreasing. Secondly, there is significant pressure from capital expenditures. Due to rising component costs, the company has raised its capital expenditure guidance for 2026 by around $500 million. Although management emphasizes that costs can be passed on to customers through contract terms, in a competitive environment, is there a limit to this cost pass-through ability? Continuous high capital expenditures and potential financing needs will test its financial stability in a high-interest rate environment.