CoreWeave (CRWV) shares slipped after J.P. Morgan analyst Mark R. Murphy cut his rating on the AI cloud company from Overweight to Neutral and lowered his price target to $110 from $135. The move came after the company reported Q3 results that showed strong long-term demand but short-term pressure from supply delays.
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Murphy said the third quarter was a mix of positives and setbacks. Revenue rose 133% year-over-year to $1.36 billion, beating forecasts, and the loss per share of $0.22 was smaller than expected. The company’s order backlog nearly doubled to $56 billion, showing that demand for AI infrastructure remains strong.
However, Murphy noted that some projects were delayed due to supply-chain issues, which pushed a portion of revenue out of the quarter. He said these delays added short-term pressure even as CoreWeave continues to win large AI contracts and attract new clients like CrowdStrike (CRWD), Rakuten, Poolside, and Jasper.
Why J.P. Morgan Downgraded CRWV to Neutral
Murphy said the downgrade reflects supply-chain problems that are slowing CoreWeave’s data center projects. A delay at one third-party builder forced the company to trim 2025 revenue guidance to $5.1 billion, down from $5.25 billion, and to cut planned capital spending by $8.5 billion.
These issues are expected to ease by early 2026, but Murphy warned they highlight how tight capacity has become across the AI industry. “Forecasting when these moving parts will stabilize remains difficult,” Murphy wrote.
Long-Term View Still Positive
Even with the downgrade, Murphy said CoreWeave’s growth story remains solid. The company keeps winning major AI deals with OpenAI, Microsoft (MSFT), and Nvidia (NVDA), showing its strong position in the global AI data-center market. Also, its $56 billion backlog points to steady future demand, and a broader customer base is helping cut its reliance on a few big clients.
Murphy expects growth to pick up again in early 2026 once current supply issues fade. He compared the situation to Microsoft’s Azure recovery earlier this year after similar project delays.
For now, he called CoreWeave stock a “volatile ride” that needs patience and a high risk tolerance.
Is CRWV Stock a Buy?
The stock of CoreWeave has a consensus Moderate Buy rating among 24 Wall Street analysts. That rating is based on 12 Buy, 11 Hold, and one Sell recommendation assigned in the last three months. The average CRWV price target of $155.36 implies 47.11% upside from current levels.
