CoreWeave Shares Plunge as Investors Question Nvidia-Backed AI Valuations
CoreWeave shares fell 11.9% after investors questioned the valuations of AI startups backed by Nvidia Corp.
Shares of CoreWeave Holdings Inc. plunged 11.9% following a wave of investor skepticism regarding the valuations of artificial intelligence startups backed by Nvidia Inc. The selloff occurred despite a public effort by Nvidia Chief Executive Officer Jensen Huang to defend the financial health of the neocloud provider last Thursday.
CoreWeave operates as a data center provider that purchases processing chips to lease computing power to customers developing and running AI models. Nvidia remains the second-largest shareholder in the company. The recent price drop indicates a growing market concern over whether the high valuations of AI infrastructure companies are sustainable.
