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CoreWeave Caught in Oracle's Crossfire: Why AI Infrastructure Stocks Are Under Pressure

MarketDash Editorial Team
13 hours ago
CoreWeave stock dropped Thursday as Oracle's mixed earnings report sparked broader concerns about whether AI infrastructure companies can actually turn massive capital spending into sustainable profits.

CoreWeave Inc. (CRWV) had a rough Thursday afternoon, sliding lower alongside a broader tech sector retreat sparked by Oracle Corp's (ORCL) mixed fiscal second-quarter earnings. The selloff highlights growing investor anxiety about whether the AI infrastructure boom can actually deliver on its lofty promises.

What's Happening: Oracle reported impressive backlog growth, but its revenue of $16.06 billion fell short of analyst expectations. That disappointment led to multiple price target downgrades and rippled through the cloud infrastructure space, dragging down specialized players like CoreWeave in the process.

Here's the core issue: Oracle's report has reignited concerns about an AI bubble where companies are pouring billions into infrastructure but struggling to convert that spending into immediate revenue. Oracle significantly raised its fiscal 2026 capital expenditure guidance to build out data centers, yet the revenue miss suggests monetization isn't keeping pace. That's a flashing warning sign for CoreWeave, whose entire business model depends on capital-intensive GPU rentals.

During Oracle's earnings call, Co-CEO Clay Magouyrk drew a sharp distinction between Oracle and "AI infrastructure neo-clouds" like CoreWeave. His argument? Oracle's diversified capabilities create a competitive moat that specialized firms simply don't have.

Investors are connecting the dots. If a behemoth like Oracle is facing margin pressure and revenue challenges despite unprecedented AI demand, what does that mean for smaller, highly leveraged pure-play competitors like CoreWeave? The risk is that these companies may struggle even more to maintain profitability and justify their valuations, especially in a high-interest rate environment.

The Technical Picture: Market data assigns CoreWeave a low Value score of 6.26, while technical indicators confirm bearish trends across short, medium, and long-term timeframes.

Price Action: CoreWeave shares traded down 2.68% at $85.86 Thursday afternoon, according to MarketDash data.

The decline puts the stock well below key technical levels. CoreWeave is trading approximately 23.9% below its 50-day moving average of $108.50 and about 21.8% below its 200-day moving average of $105.56. Both metrics point to sustained bearish momentum in the medium to long term.

Back to News

CoreWeave Caught in Oracle's Crossfire: Why AI Infrastructure Stocks Are Under Pressure

MarketDash Editorial Team
13 hours ago
CoreWeave stock dropped Thursday as Oracle's mixed earnings report sparked broader concerns about whether AI infrastructure companies can actually turn massive capital spending into sustainable profits.

CoreWeave Inc. (CRWV) had a rough Thursday afternoon, sliding lower alongside a broader tech sector retreat sparked by Oracle Corp's (ORCL) mixed fiscal second-quarter earnings. The selloff highlights growing investor anxiety about whether the AI infrastructure boom can actually deliver on its lofty promises.

What's Happening: Oracle reported impressive backlog growth, but its revenue of $16.06 billion fell short of analyst expectations. That disappointment led to multiple price target downgrades and rippled through the cloud infrastructure space, dragging down specialized players like CoreWeave in the process.

Here's the core issue: Oracle's report has reignited concerns about an AI bubble where companies are pouring billions into infrastructure but struggling to convert that spending into immediate revenue. Oracle significantly raised its fiscal 2026 capital expenditure guidance to build out data centers, yet the revenue miss suggests monetization isn't keeping pace. That's a flashing warning sign for CoreWeave, whose entire business model depends on capital-intensive GPU rentals.

During Oracle's earnings call, Co-CEO Clay Magouyrk drew a sharp distinction between Oracle and "AI infrastructure neo-clouds" like CoreWeave. His argument? Oracle's diversified capabilities create a competitive moat that specialized firms simply don't have.

Investors are connecting the dots. If a behemoth like Oracle is facing margin pressure and revenue challenges despite unprecedented AI demand, what does that mean for smaller, highly leveraged pure-play competitors like CoreWeave? The risk is that these companies may struggle even more to maintain profitability and justify their valuations, especially in a high-interest rate environment.

The Technical Picture: Market data assigns CoreWeave a low Value score of 6.26, while technical indicators confirm bearish trends across short, medium, and long-term timeframes.

Price Action: CoreWeave shares traded down 2.68% at $85.86 Thursday afternoon, according to MarketDash data.

The decline puts the stock well below key technical levels. CoreWeave is trading approximately 23.9% below its 50-day moving average of $108.50 and about 21.8% below its 200-day moving average of $105.56. Both metrics point to sustained bearish momentum in the medium to long term.