CoreWeave, a fast-growing AI startup backed by Nvidia, has signed a significant five-year agreement worth $11.9 billion with OpenAI. The contract will see CoreWeave provide essential AI infrastructure to OpenAI, which is known for its ChatGPT technology. As part of the deal, OpenAI will acquire shares valued at $350 million in CoreWeave through a private placement during the company’s upcoming initial public offering (IPO). This partnership significantly strengthens CoreWeave’s position as it prepares for a major IPO, which is expected to take place in 2025.
The deal is a major win for CoreWeave, a New Jersey-based firm that specializes in providing data centers and high-powered computing resources for AI workloads, often using Nvidia chips. CoreWeave’s infrastructure is crucial for supporting the growing demand in AI technology, which has seen a surge in global interest, particularly from companies like Microsoft, Meta, and IBM. OpenAI CEO Sam Altman highlighted that CoreWeave’s services complement their existing partnerships with tech giants like Microsoft and Oracle, as well as their joint venture with SoftBank.
Ahead of the IPO, CoreWeave has also seen rapid financial growth. The company’s revenue jumped from $228.9 million in 2023 to $1.92 billion in 2024. However, despite the growth, its net loss has widened, reaching $863.4 million in 2024 compared to $593.7 million the year before. A successful IPO for CoreWeave could pave the way for other AI startups to follow suit, as interest in AI infrastructure and data centers continues to rise.
Founded in 2017, CoreWeave has already attracted significant investments, including over $14.5 billion in debt and equity across 12 financing rounds. The company is expected to target a valuation of more than $35 billion when it goes public. As one of the key players in the rapidly expanding AI infrastructure market, CoreWeave’s upcoming IPO is set to be one of the marquee listings for 2025, potentially inspiring other startups in the AI space to enter public markets.
SOURCE: REUTERS