CoreWeave Falls 11% to $54.34 as Investor Concerns Mount Over AI Spending

Key Facts

CoreWeave shares fell 11% to $54.34 in trading on October 30, while Nebius fell 9%, Cloudflare 12% and Snowflake 9%, according to 24/7 Wall St. The moves came amid renewed concern about the pace of major technology companies’ spending on the infrastructure needed for artificial intelligence, and whether that spending will generate returns commensurate with its scale. A key concern was that Microsoft and Alphabet’s capital spending came in below analysts’ average expectations in the companies’ latest results. But the demand picture was not one-sided: Microsoft said customer demand still exceeds available supply. A potential slowdown would have different effects on companies that own infrastructure and those that rely on selling cloud and software services.

Microsoft’s capital expenditures and finance lease commitments totaled $45.2 billion in its first fiscal quarter of 2027, compared with Wall Street analysts’ average estimate of $50.7 billion. Chief Financial Officer Amy Hood said some capacity deliveries from third parties had been delayed, suggesting that the timing of investment does not necessarily reflect a decline in computing needs. She said the company expects capital spending to exceed $50 billion in the next quarter and reach about $170 billion in calendar year 2026. That puts a below-expectations quarterly reading alongside guidance for substantial spending in the coming months. Capacity delays also connect spending levels with suppliers’ ability to deliver the required infrastructure.

Alphabet reported capital spending of $51.36 billion, below the analysts’ average estimate of $55.09 billion. Meanwhile, Google’s quarterly free cash flow was negative $9.1 billion, compared with expectations of negative $3.5 billion. The divergence puts infrastructure spending at the center of discussion about financing AI expansion, as markets track its effect on liquidity alongside services growth. More broadly, Reuters said higher borrowing costs make debt-funded investment more expensive and harder to justify. Meta’s plan to raise a record $97.5 billion in financing has also raised concerns about shareholder dilution and major technology companies’ reliance on capital markets to fund spending.

Growth results at cloud services companies were not similarly weak. Cloudflare’s revenue in the second quarter of 2026 was about $696.1 million, up 35.9% year over year, and the company raised its full-year revenue guidance. Snowflake generated about $1.55 billion in revenue in the second quarter of its fiscal year 2027, up 35.1% year over year, and also raised its full-year product revenue forecast. CoreWeave, which leases specialized computing capacity, said its chief executive that “near-term available capacity is almost entirely sold out.” Its remaining performance obligations stood at $104.2 billion as of June 30, and it added more than $25 billion in new customer commitments at the start of the third quarter. These figures point to strong demand and contracted business, but come alongside the rising cost of financing expansion.

CoreWeave’s interest expense rose to $640 million in the second quarter of 2026, from $267 million a year earlier, highlighting its business model’s sensitivity to financing costs as it builds infrastructure. The pressure extended to U.S. stock indexes in trading on October 30: the S&P 500 fell 1.6%, the Nasdaq Composite 2.5% and the Dow Jones 0.7% by 11:48 a.m. Eastern time, according to the Associated Press. Alphabet had lost more than 12% in the previous session, its biggest recorded one-day decline, after telling investors it had burned through more cash over the summer. Reuters estimated that the Nasdaq 100’s market value was on track to fall by more than $2 trillion in October, with the index down more than 5.8% since the start of the month. By contrast, Reuters pointed to results at Microsoft and SpaceX showing that AI spending had started to generate returns, with Microsoft expecting strong growth in cloud services.

The share moves reflect a divide between specialized cloud computing companies, which need substantial financing to expand data centers, and companies such as Cloudflare and Snowflake, which sell digital services and have reported strong revenue growth. Reuters estimated that global AI spending could reach $900 billion in 2026 and $5.5 trillion by 2030, while Gartner said earlier in October that 80% of cloud computing startups could cease operating independently by 2032. In premarket trading on October 26, CoreWeave shares had fallen 4.5% and Nebius 3.4% amid concerns about the gap between infrastructure investment and revenue. Reuters reported that CoreWeave, Nebius and IREN shares had fallen more than 30% in October through the 26th, while short sellers had booked paper profits of at least $6 billion. The October 29 closes were $60.74 for CoreWeave, $171.99 for Nebius, $310.3 for Cloudflare and $330.27 for Snowflake; those were prices for that day, separate from trading on October 30.

Attention is turning to CoreWeave’s third-quarter results, scheduled for release on November 10, 2026, at 5:00 p.m. Eastern time, according to the company. The results will provide a near-term opportunity to compare customer commitments, available capacity and financing expenses with reported operating performance. The market’s assessment remains tied to infrastructure companies’ ability to meet demand and turn contracts into revenue, and to the amount of financing required to do so. Spending and forward guidance from major buyers also set a benchmark for evaluating opportunities for specialized suppliers. The gap between reported demand and the timing of capacity deliveries remains a focus in the coming weeks.