CoreWeave CEO Reportedly Says The Neocloud Provider Could Become Profitable In 3 Months If It Stopped Scaling Up, But Here's Why He's Holding Back

• Intrator said that the company is currently focusing its energy on the generational opportunity of ramping up AI infrastructure to grow and expand its business.
• He also stated that CoreWeave has focused on diversifying its customer base, while adding that none of the clients make up more than 35% of its order book.
• Intrator also added that CoreWeave intends to sell old GPUs once they are off long contracts, which he thinks will drive margins in the future.

CoreWeave Inc. (CRWV) CEO Michael Intrator on Friday reportedly stated that the neocloud provider could become profitable within the next three months, but explained why the company is holding back on it for now.

During an interview with CNBC, Intrator highlighted that the priority for CoreWeave is to scale up its operations right now, which can be expensive. He said that the company is currently focusing its energy on the generational opportunity of ramping up AI infrastructure to grow and expand its business.

“If we stop growing at the rate we’re growing, this company would become enormously profitable within three months. We’re making the strategic decision to get to scale,” Intrator said. He added that getting to scale allows CoreWeave access to capital markets, which drives down its cost of capital, helping the company compete in the future.

CoreWeave shares were up nearly 13% in Friday morning’s trade. Retail sentiment on Stocktwits around the company trended in the ‘extremely bullish’ territory with message volumes at ‘extremely high’ levels.

Scale First, Profit Next

Intrator stated during the interview that the way CoreWeave is working on scaling up its business to capitalize on the demand for AI infrastructure, margins will improve over time.

He highlighted CoreWeave’s forecast announced during the last earnings call, wherein the company guided for revenue to grow from $5 billion to more than $12 billion by the end of 2026.

“That ramp comes with an enormous opportunity to drive margins as we continue to grow. But we need to have the opportunity to scale and scaling is expensive,” Intrator said.

He also stated that CoreWeave has focused on diversifying its customer base, noting that none of its clients make up more than 35% of its order book.

“We’ve done an incredible job. I’m super proud of the company for the degree of diversification that we’ve made,” he added.

Intrator Says Old GPUs Will Be ‘Incredibly Valuable’

The CoreWeave CEO added that as Graphics Processing Units (GPUs) get older, they will become “incredibly valuable.”

Intrator explained that the company has seen evolving use cases for older hardware, with their clients repurposing old GPUs for inference and other use cases to drive their business.

“Those signals have been out there since AI began, and we’ve been scaling our business with the intention of holding those GPUs because we believe they are going to continue to be incredibly valuable when they come off these long contracts that pay back the debt we’ve taken on,” he added.

Intrator said that CoreWeave intends to sell those old GPUs again, adding that this will drive margins in the future.

CRWV stock is up 45% year-to-date and 146% over the past 12 months. The Vanguard Total Stock Market Index Fund ETF (VTI) is up 30% over the past 12 months, while the Vanguard Mid-Cap Index Fund ETF (VO) is up 24%.

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