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Newsletter: We need to talk about CoreWeave, the first big IPO of the generative AI bubble, with a speculated $35bn valuation, burdened by ruinous debt, impossible-to-meet capacity obligations, and a data center partner that's never built any AI compute. www.wheresyoured.at/core-incompetency/

Like any company that goes public, CoreWeave is obligated to release a document that reveals its financial state, and the risks facing the business, and CoreWeave's disclosures show it's deeply unprofitable, burdened by debt and reliant on a few big customers. www.wheresyoured.at/core-incompetency/

CoreWeave has about $8bn in debt, and its indebtedness will undoubtedly only increase in years to come. And, like OpenAI, it loses more money than it makes, spending $1.43 to make $1, and needs tens of billion to keep growing. They feel built for collapse. www.wheresyoured.at/core-incompetency/

CoreWeave is a terrible business, with 77% of its revenue from two companies (Microsoft/NVIDIA), living and dying on the idea that generative will both is and will continue to be a high-growth business. Their business suggests gen. AI doesn't have legs. www.wheresyoured.at/core-incompetency/

CoreWeave's numbers deeply concern me - they're existentially tied to the idea that generative AI will become both a massive, revenue-generating and remain an incredibly compute-intensive industry. Microsoft's data center pullback and DeepSeek beg to differ. www.wheresyoured.at/core-incompetency/

CoreWeave's debt is genuinely insane, backed by a depreciating asset (GPUs) that increases the payments based on their value, and could lead to them paying $2bn+ a year in interest for a company that needs tens of billions to build the data centers to grow. www.wheresyoured.at/core-incompetency/

CoreWeave doesn't have access to the capital necessary to meet its obligations. CoreWeave may have "billions of dollars" of contracted compute, but I estimate they will need $39 billion+ to build the data centers to serve it. They do not have the capital to build. www.wheresyoured.at/core-incompe...

CoreWeave is also using a suspicious and unproven partner - Core Scientific - to build out ALL their capacity. They've only ever built Bitcoin mining servers, were bankrupt a year ago, and have never, ever built an AI data center. How does this work? www.wheresyoured.at/core-incompe...

Core Scientific is a dog of a company that went public via a SPAC in 2022. Their only AI customer is CoreWeave, and I can find no evidence of Core Scientific operating or completing an AI data center. They made $24m in 2024 on AI. How does this WORK? www.wheresyoured.at/core-incompetency/

CoreWeave's financial health and revenue suggest that there either isn't demand or profit in providing services for generative AI. Outside of two companies, CoreWeave's revenue for AI compute is small, unprofitable and unstable. I do not see how they survive. www.wheresyoured.at/core-incompe...

I am terrified not of the collapse of the ai bubble, but of the ensuing desperate governmental power grab that will happen (and is happening) to attempt to keep propping it up. In the end, there’s a high probability they foot the taxpayers with the bill for expenditures starting with crypto.