KUALA LUMPUR, March 28 – CoreWeave, a cloud services provider backed by Nvidia, has reduced both the size of its U.S. initial public offering (IPO) and the price of its shares. This move reflects growing investor concerns about the company’s long-term growth and the uncertain market environment.

Now, CoreWeave plans to sell 37.5 million shares at $40 each— well below the original price range of $47 to $55. This change also reduces the offering size by 23.5%. Of the total shares, 36.6 million will come directly from the company, while existing shareholders will sell 910,000.

With these adjustments, the IPO is expected to raise approximately $1.5 billion and value the company at around $23 billion on a fully diluted basis. Meanwhile, Nvidia has agreed to support the offering with a $250 million investment, according to sources familiar with the deal.

Growing Investor Concerns

Despite CoreWeave’s rapid growth, investors are approaching the IPO with caution. One major concern is the company’s dependence on Microsoft, a key customer.

Any changes in Microsoft’s AI data center strategy could affect future demand for CoreWeave’s GPU (graphics processing unit) services.

Another worry is the company’s heavy debt load. As of last year, CoreWeave had $8 billion in debt and $2.6 billion in operating lease liabilities. While the company plans to use about $1 billion from the IPO to pay down some of this debt, it also indicated it will continue borrowing to support future growth.

Is The AI Wave Slowing Down?

CoreWeave’s IPO comes at a time when the excitement around AI infrastructure is beginning to cool. Although the company has deployed more than 250,000 Nvidia GPUs to power AI workloads, there are signs that the rapid expansion of AI hardware may be slowing down.

Investors appear to be re-evaluating valuations in the AI infrastructure space, said Lukas Muehlbauer, a research analyst at IPOX.

Adding to the pressure, competition from global players like China’s DeepSeek is heating up. This is raising concerns that future spending on data centers may become uneven— favoring tech giants while smaller companies struggle to keep pace.

A Critical Moment for the Market

CoreWeave’s public debut is being closely watched as a test of the broader U.S. IPO market. According to Dealogic data, the first quarter of this year saw only 187 equity capital market deals, a drop from 243 during the same period in 2024. The total value of these deals also fell, from $74.02 billion to $63.48 billion.

Despite the challenges, CoreWeave is pushing ahead. The company recently signed an $11.9 billion infrastructure deal with OpenAI. As part of the IPO, OpenAI will receive $350 million in shares through a private placement.

Morgan Stanley, J.P. Morgan, and Goldman Sachs are leading the IPO. The news of CoreWeave’s decision to reduce the offering size was first reported by Semafor. REUTERS