CoreWeave shares made their debut on the Nasdaq Friday, with shares dropping as much as 5.8% after trading began.
The specialized cloud computing provider, which is focused on high-performance workloads, particularly for artificial intelligence (AI), had priced its initial public offering at $40 per share, less than the expected range of $47 to $55.
The Nvidia Corp (NASDAQ:NVDA, ETR:NVD)-backed cloud computing company aims to raise approximately $1.5 billion in what has become the largest technology offering in the United States since 2021.
Following CoreWeave's IPO, Nvidia shares lost around 1.4% Friday afternoon, while Microsoft Corp (NASDAQ:MSFT), a major CoreWeave customer, fell over 3%.
At the $40 per share IPO pricing, CoreWeave’s valuation will be approximately $19 billion. At the top end of the expected range, CoreWeave would have been valued at about $26.5 billion.
"To justify the revised valuation, the company’s revenue should grow by more than 25% annually each year for a decade," said Ipek Ozkardeskaya, Senior Analyst at Swissquote Bank.
"That’s comparable to growth that Microsoft’s and Amazon’s data centers printed over the past years, but that growth also left investors with a doubt of oversupply."