CoreWeave secures $11.9 billion OpenAI contract as IPO nears

CoreWeave, an Nvidia-backed artificial intelligence startup, has struck a five-year agreement worth $11.9 billion with OpenAI.

The agreement means CoreWeave is to provide AI infrastructure for OpenAI as it prepares for its initial public offering (IPO).

Under the agreement, OpenAI will receive $350 million of CoreWeave shares through a private placement when the company floats its IPO. CoreWeave confirmed the details in a statement on Monday following an earlier report from Reuters. The company will not receive any proceeds from the share issuance to OpenAI.

Sam Altman, OpenAI’s CEO, said the deal strengthens OpenAI’s infrastructure capabilities, adding CoreWeave to its existing partnerships with Microsoft and Oracle, and his company’s joint venture with SoftBank on the $500 billion Stargate project.

Strengthening AI infrastructure

CoreWeave is based in Livingston, New Jersey, and provides access to data centres and high-powered AI chips, primarily supplied by Nvidia. The company competes with major cloud providers, including Microsoft Azure and AWS, in the AI infrastructure space.

The AI sector has seen a surge in demand for computing power and infrastructure as generative AI adoption grows. Chipmakers like Nvidia and other major tech firms have benefited from the trend, driving increased interest in data centres and high-performance servers.

CoreWeave’s contract with OpenAI comes at a time when investor interest in AI is growing rapidly. A successful IPO could pave the way for other AI companies to enter public stock markets, such as data centre operator Switch, which is reportedly considering an IPO with a valuation of around $40 billion including debt.

Financial performance and IPO plans

CoreWeave filed for an IPO in March with a target valuation of more than $35 billion, according to Reuters. In 2024, the company reported $1.92 billion in revenue, up from $228.9 million in 2023. However, its net loss increased to $863.4 million from $593.7 million the year before.

Approximately two-thirds of CoreWeave’s revenue in 2024 came from Microsoft, making it the company’s largest customer. CoreWeave’s other major clients include Meta, IBM, and Microsoft.

Since its founding in 2017, CoreWeave has raised over $14.5 billion through 12 funding rounds, including more than $7 billion in private debt financing in 2023. The debt round was led by asset managers Blackstone and Magnetar, marking one of the largest private debt deals in recent history.

Morgan Stanley, JPMorgan Chase, and Goldman Sachs are leading CoreWeave’s stock market debut. The company’s shares are expected to trade on the Nasdaq under the symbol “CRWV.”

Expanding market influence

The AI boom has reshaped the technology market, with companies racing to secure infrastructure to support AI-driven applications. CoreWeave’s partnership with OpenAI positions it to capitalise on this trend by securing long-term demand for its infrastructure services, despite its trading at a loss.

Altman’s acknowledgment of CoreWeave’s role inside OpenAI’s ecosystem emphasises the strategic worth of the agreement. The partnership will help OpenAI scale its AI models and provides CoreWeave with a consistent revenue stream as it moves onto the public market.

CoreWeave’s IPO is expected to be one of the most closely watched tech listings in 2025, its success potentially influencing other AI companies considering public offerings.

See also: CoreWeave prepares for IPO amid rapid growth in AI cloud services.

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