Near-term supply chain pressures will cap gains for CoreWeave , according to JPMorgan. The bank downgraded CoreWeave, which provides infrastructure for artificial intelligence firms, to neutral from overweight. Analyst Mark Murphy also lowered his price target to $110 per share from $135, signaling just 4% upside ahead. Murphy’s downgrade followed CoreWeave’s third-quarter earnings release . While the company reported better-than-expected third-quarter revenue, its full-year revenue guidance came in below analysts’ expectations. CoreWeave shares tanked 10% in the premarket. CRWV YTD mountain CRWV YTD chart CoreWeave also said that one third-party data center developer is behind schedule. While CEO Mike Intrator assured investors that this delay wouldn’t affect CoreWeave’s backlog, JPMorgan’s Murphy wasn’t so sure, and pointed to the company’s supply constraints as a major headwind. “The new variable is supply chain pressures escalating to a point that they are impacting one specific third-party data center developer used by CoreWeave, which is running behind schedule and shifts some of CoreWeave’s revenue out of Q4,” he wrote. “This means that not only are the major hyperscalers being forced to issue capacity-constrained revenue guidance, but the phenomenon is also spreading to CoreWeave, which has historically set one of the highest bars for on-time orchestration and delivery cadences in deployment of modern AI data centers.” But Murphy emphasized that, in the long run, he sees “tremendous” opportunity for CoreWeave to serve the AI mega-trend and remains fundamentally constructive on the name. “Our view of CoreWeave’s longer term opportunity remains unchanged, and it is possible that its revenue ramp will get back on track in Q1/Q2 of next year, as we saw with Microsoft’s Azure surge in its most recent March and June quarters,” he added. “However, we remain contemplative of the unprecedented and mounting industry-wide pressures across supply chains, and resultant difficulty of confidently forecasting how and when all of the interconnected variables will smoothly reach a point of equilibrium.” Shares of CoreWeave have soared 164% since going public in March.
