By Echo Wang
NEW YORK (Reuters) -CoreWeave, an artificial intelligence startup backed by Nvidia, has signed a five-year cloud-computing contract worth $11.9 billion with OpenAI ahead of its hotly anticipated stock market launch, people familiar with the matter told Reuters on Monday.
The deal will give OpenAI a stake in CoreWeave, which will issue shares worth $350 million to the ChatGPT maker through a private placement at the time of its initial public offering, the sources said, requesting anonymity as the discussions are confidential.
Livingston, New Jersey-based CoreWeave, which is one of the hottest AI startups in the U.S., will not receive any proceeds as part of the share issue to OpenAI, the sources said, adding that the details of the new contract and the placement are expected to be revealed in CoreWeave’s updated IPO filing.
The company is expected to list its shares in New York in the coming weeks, the sources added, cautioning that the timing and size of CoreWeave’s stock market launch are subject to market conditions and the terms of the deal with OpenAI could change.
CoreWeave declined to comment. OpenAI did not immediately respond to requests for comment.
If the talks are successful, the deal would provide a major boost to CoreWeave ahead of its blockbuster share sale, which is expected to headline the U.S. IPO lineup for 2025.
The discussions with OpenAI come at a time when investor interest in generative AI is skyrocketing. The AI boom, which has powered chipmakers such as Nvidia and other big tech firms, has driven a surge in global demand for infrastructure such as data centers and high-powered servers.
A successful IPO for CoreWeave could pave the way for other AI startups that have recently considered tapping public markets. Data center operator Switch has been weighing an IPO at a valuation of about $40 billion, including debt, Reuters reported last year.
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Founded in 2017, CoreWeave provides access to data centers and high-powered chips for AI workloads, mainly supplied by Nvidia. It competes against cloud providers such as Microsoft’s Azure and Amazon’s AWS.
CoreWeave, whose customers include big tech companies including Meta, IBM, and Microsoft, is expected to target a valuation of more than $35 billion in its stock market listing, Reuters reported in November.
In its IPO filing earlier in March, CoreWeave reported revenue of $1.92 billion in 2024, compared with $228.9 million a year earlier. Its net loss widened to $863.4 million during the same period from $593.7 million in 2023. Roughly two-thirds of its revenue came from Microsoft, which is the company’s biggest customer.
CoreWeave has raised more than $14.5 billion in debt and equity across 12 financing rounds, according to data compiled by Reuters. Last year, CoreWeave raised over $7 billion in one of the largest private debt financing rounds in history, led by asset managers Blackstone and Magnetar.
Morgan Stanley, JPMorgan Chase, and Goldman Sachs are the lead underwriters for CoreWeave’s upcoming stock market flotation. CoreWeave’s shares are expected to trade on the Nasdaq under the symbol CRWV.
(Reporting by Echo Wang in New York; Editing by Anirban Sen and Lisa Shumaker)
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