CoreWeave shares recover 6% after Jensen Huang eases concerns over its finances

what happened

CoreWeave shares climbed 6% to $69.69 on Thursday, recovering nearly 17% from an intraday low of $59.51. The rebound followed a 15.5% plunge on Wednesday, when investors questioned how the company funds its rapid expansion.

Nvidia CEO Jensen Huang, speaking to Bloomberg in Stockholm, said CoreWeave's financial strength was improving and its cost of capital was falling, and that Nvidia did not need to provide a financial backstop. Nvidia supplies the processors behind CoreWeave's cloud services and owns about 10% of the company.

The debt market is less convinced. Some CoreWeave bonds traded near 79.5 cents on the dollar, implying a yield above 15%, but that figure reflects the discounted price and does not change the fixed coupon on existing debt. Second-quarter net interest expense came to $640 million, versus $267 million a year earlier. Revenue nearly doubled to roughly $2.6 billion, yet the company posted a $626 million net loss.

Cash generation trails spending. Operating cash flow was $679 million in the second quarter, while purchases of property and equipment, including capitalized software, reached about $6.4 billion. Revenue backlog stood at $104 billion as of June 30, excluding more than $25 billion of customer commitments secured early in the third quarter. Backlog, however, is expected future revenue under contracts, not cash already collected.

why it matters

For markets, the gap between equities and credit is the key signal. A sustained rebound in both bond prices and share prices, alongside easier financing conditions, would offer firmer evidence of returning confidence than a stock rally alone.

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