MW Will CoreWeave bears get burned? New Nvidia deals spark fresh optimism for the stock.

By Christine Ji

Nvidia and OpenAI's $100 billion partnership has one analyst upgrading CoreWeave's stock to a buy, arguing that the neocloud is set to capture a massive wave of new business

The latest Nvidia-OpenAI partnership could drive more incremental business to CoreWeave.

CoreWeave Inc. and Nvidia Corp.'s $6.3 billion cloud-services agreement has sent CoreWeave's stock surging 10% in the last week. And now, Nvidia's new $100 billion investment in OpenAI has added even more fuel to the rally.

"When you think it can't get better, it does," Ben Reitzes of Melius Research wrote of the Nvidia-OpenAI deal on Tuesday. These recent deals indicate a surge of fresh demand for computing and networking services, and neoclouds like CoreWeave (CRWV) are poised to benefit tremendously from new contracts, according to Reitzes.

As a result, Reitzes lifted his price target on CoreWeave's stock to $165 from $128 and boosted his rating to buy from hold, citing increased revenue estimates through 2030.

CoreWeave benefits from the Nvidia-OpenAI partnership through its ability to capture overflow demand as well its strategic positioning. OpenAI has already been utilizing CoreWeave's service aggressively, signing a $12 billion contract with CoreWeave in March of this year and then expanding it to $16 billion a few months later.

The most recent agreement with Nvidia shows that the deals and need for computing power are only increasing. Under the partnership, OpenAI will deploy at least 10 gigawatts of artificial-intelligence data centers with Nvidia systems, with the first gigawatt expected to come online in 2026.

CoreWeave is set to benefit "as OpenAI looks to find multiple places to deploy its newly announced 10GW with Nvidia compute and further broadens its infrastructure footprint," according to Reitzes.

With both Nvidia and OpenAI as investors, CoreWeave is also "typically among the first to receive Nvidia's next-generation AI systems, positioning it well to capture a large amount of cloud demand over the long term," Reitzes wrote.

Additionally, Nvidia's agreement with CoreWeave ensures that the chip giant will purchase any cloud capacity that CoreWeave can't sell, creating more visibility for future revenues.

Investors have been concerned about CoreWeave's access to power and financing structure, which contributed to the stock's roughly 50% drop from June highs. D.A. Davidson analyst Gil Luria highlighted that CoreWeave will need to scale up its business in coming years by taking on more debt.

MoffettNathanson analyst Nick Del Deo also cautioned in a note earlier this month that power could be a "gating factor" for CoreWeave, as it won't be able to realize the value of its contracts if it can't bring capacity online fast enough. And while CoreWeave has been racking up business wins lately, he warned that the neocloud industry could face commoditization in coming years, meaning that investors shouldn't view CoreWeave's product as "unique" or resistant to competition.

Reitzes, though, is optimistic that CoreWeave will be able to bring more power online once its acquisition of Core Scientific (CORZ) closes. Additionally, the increase in demand for computing power and CoreWeave's relationship with Nvidia and OpenAI should help the company raise more funding in the future should it need it, he added. CoreWeave's contracts are "highly profitable and cash flow accretive," he said, meaning that an increased order book should help the company fund its growth going forward.

Also read: What CoreWeave's new $6.3 billion contract with Nvidia says about the AI trade

-Christine Ji

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September 23, 2025 10:41 ET (14:41 GMT)

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