CoreWeave (CRWV) reported a Q2 beat and raised guidance, with inference demand driving upside despite higher near-term capital expenditures, Oppenheimer said in a note Wednesday.

The company's inference services platform grew more than 100-fold in just a few months as incremental capacity was allocated to inference, driving better revenue-per-megawatt economics, the analysts said.

They added that they expect higher revenue/MW, faster-than-expected capacity additions, and longer server useful lives to provide further upside.

The analysts said the main negative is the higher capital expenditures outlook, which puts near-term pressure on free cash flow and operating margins as capacity is added ahead of the related revenue.

"Still, the strong growth outlook and market positioning clearly outweigh the near-term investment needs," they added.

Oppenheimer reiterated its outperform rating and $150 price target on CoreWeave.

The company's shares rose nearly 18% in the session.

Price: 106.31, Change: +15.99, Percent Change: +17.70