Nvidia CEO Jensen Huang has sometimes been referred to as the Godfather of AI, and it’s not uncommon for stocks that have received the chip giant’s blessing to push higher as a result. That was the case for CoreWeave (NASDAQ:CRWV) shares, which climbed on the back of a new deal with the AI chip king.
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The agreement disclosed yesterday showed that the cloud infrastructure provider had signed a new order form with Nvidia under their existing Master Services Agreement (MSA), with Nvidia committing $6.3 billion to CoreWeave’s infrastructure.
“More importantly though,” says Barclays analyst Raimo Lenschow, “as part of the amended terms, Nvidia is obligated to purchase any residual unsold capacity that CoreWeave has through April 13th, 2032, subject to any termination and satisfaction of delivery requirements by either party.”
Under standard terms, the MSA will stay in effect until all outstanding orders have been fulfilled. A complete description of the MSA will appear in the company’s 10-Q for the quarter ending September 30, 2025.
CoreWeave and Nvidia already tout a pretty close relationship, with CoreWeave CEO Mike Intrator saying earlier this year that he is not shy about contacting Huang. Beyond having access to the CEO, CoreWeave invests significantly in hundreds of thousands of Nvidia GPUs, which it leases to its customers. The company, which held its IPO in March, is supported by Nvidia, which owns roughly 7% of CoreWeave’s Class A shares (as of June 30).
All told, Lenschow sees the deal as a positive development for CoreWeave, especially amid investor concerns about the company’s ability to utilize data center capacity beyond its two largest clients, Microsoft and OpenAI. The amended MSA acts as a safety net, guaranteeing that capacity will be utilized regardless of the end customer, and the 5-star analyst sees Nvidia’s additional spend as a healthy step toward diversifying away from CoreWeave’s biggest customers.
From Nvidia’s perspective, Lenschow thinks the announcement is unsurprising, given its key role in supporting the IPO earlier this year, the existing CoreWeave infrastructure, and recent similar agreements with other Neoclouds, most notably Lambda Labs.
However, all of that is not quite enough for Lenschow to get fully behind CRWV right now; the analyst assigns the stock an Equal Weight (i.e., Neutral) rating and a $140 price target. Nevertheless, there’s potential upside of ~18% from current levels. (To watch Lenschow’s track record, click here)
12 other analysts join Barclays on the sidelines, yet with an additional 13 Buys and 2 Sells, the stock claims a Moderate Buy consensus rating. The average price target stands at $141.96, a figure that makes room for 12-month returns of 19.5%. (See CRWV stock forecast)
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Disclaimer: The opinions expressed in this article are solely those of the featured analyst. The content is intended to be used for informational purposes only. It is very important to do your own analysis before making any investment.