AI-focused CoreWeave earnings lift S&P 500 and Nasdaq
CoreWeave reported a path to profitability in early 2028, prompting a rally in AI-related stocks and boosting the S&P 500 and Nasdaq indexes.
The S&P 500 and the tech-heavy Nasdaq rose on Wednesday after cloud-computing firm CoreWeave posted earnings that eased concerns about excessive AI spending. CoreWeave said it expects to become profitable on an adjusted basis in the first half of 2028, citing strong demand and customer commitments that support its debt-financed expansion.
"CoreWeave was emblematic of the shift from viewing all AI investments as good investments to taking a more sober look at the returns on the billions of dollars being spent on AI. The earnings report helped ease some of those concerns," said Steve Sosnick, chief market analyst at Interactive Brokers.
The upbeat results lifted other AI infrastructure stocks, with Nebius Group and Applied Digital gaining 12.5% and 5.2% respectively. Nvidia edged higher after a recent market-value decline, while the Philadelphia Semiconductor index rose to a one-week high, led by gains in Marvell Technology and Micron. Data-storage companies Seagate Technology and Western Digital also traded higher.
The Dow Jones Industrial Average slipped slightly, while six of the eleven major S&P 500 sectors posted gains, led by technology and energy. The CBOE Volatility Index fell for a fourth straight session, indicating reduced market fear.
Investors also watched the terms set by Anthropic for its upcoming IPO, which aims for a valuation of up to $1.4 trillion. Meanwhile, hotter-than-expected inflation data kept expectations of a Federal Reserve rate hike next month alive, with traders seeing a 50-basis-point increase as likely. Oil prices rose after Iran’s security chief said the country would not permit enriched nuclear material to leave Iran. The U.S. bond market was closed for Veterans Day.