CoreWeave Shifts AI Funding to Prepayments and Short-Term Leases

CoreWeave is rewriting how it pays for the artificial intelligence boom by demanding cash up front. The neocloud that rents out computing power reported $3.66 billion in revenue, up 168% from the previous year. Yet it also posted a $709 million net loss and $846 million in quarterly interest expense. CEO Michael Intrator stated the company will not use the unsecured debt market at current yields.

Instead, the firm is relying on loans backed by specific customer contracts to finance most of the infrastructure required for its $132.5 billion backlog. To bridge the gap, CoreWeave expects about $9 billion in customer prepayments and deposits over the next three months. This includes over $3 billion tied to signing new customer contracts for capacity it has already built, requiring no additional hardware spending.

Rivals like Nebius and IREN have also relied on hefty prepayments from Microsoft. This signals a broader industry shift toward asking Big Tech to fund data center buildouts. Our read: That reliance means the entire infrastructure boom remains bound to sustained, unproven demand from a handful of buyers.

Upfront payments alleviate immediate borrowing needs, but they commit the company to services at fixed prices.

If compute demand keeps surging, those locked-in rates might look less attractive later.

To capture higher rates, CoreWeave is shifting capacity to short-term opportunities that sell for more than $40 million per megawatt annually.

Long-term contracts for new infrastructure currently price at $20 million to $25 million per megawatt.

While short-term deals let the company adjust pricing more frequently, lenders typically favor long-term deals for predictable cash flow.

Bond investors remain cautious, with yields on some company bonds hitting above 15% last month amid concerns over debt and data center buildouts.