- CoreWeave shares dropped after HSBC issued a bearish rating and warned of customer concentration risks.
- The stock faces concerns over overvaluation and future capital spending.
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CoreWeave Inc. CRWV shares are trading lower Friday, possibly amid ongoing pressure following a bearish initiation report from HSBC on Friday.
What To Know: The decline follows HSBC’s recent initiation of coverage on CoreWeave with a Reduce rating and a price target of $32, signaling an expected downside of more than 70% from the previous closing price.
HSBC analyst Abhishek Shukla expressed concerns about CoreWeave's reliance on a limited customer base, which the firm believes weakens the company's business model. According to CNBC a significant portion of CoreWeave's revenue is concentrated among a few clients, most notably Microsoft, OpenAI and Nvidia. These customers reportedly do not utilize CoreWeave's software services, which the analyst argues undermines the company’s value proposition and limits customer retention advantages.
Shukla noted that in the first quarter of 2025, Microsoft accounted for 72% of CoreWeave's revenue, with Microsoft and OpenAI together making up the majority of the company's backlog. HSBC also warned that the stock appears overvalued after its rapid rise of more than 240% since its public debut in March 2025.
CRWV Price Action: CoreWeave shares were down 7.37% at $122.46 at the time of writing, according to Benzinga pro.
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