CoreWeave Inc (NASDAQ: CRWV) remains in a sharp uptrend this morning as investors continue to cheer its 15-year lease agreements with Applied Digital Corp (NASDAQ: APLD).

Including today’s gains, the artificial intelligence infrastructure firm is up well over 250% versus its initial public offering (IPO) price of $40.

While the company’s top-line growth sure looks compelling and the massive investor enthusiasm may tempt investors in search of the next Nvidia to pile in, a closer look reveals CRWV is sprinting towards growth with the throttle wide open – and running on borrowed fuel.

CoreWeave’s fundamentals narrate a troubling story: soaring losses, extreme customer concentration, and a capital structure built on shaky financing.

With sky-high expectations already baked into the CoreWeave stock price, the AI infrastructure company may be far more vulnerable than it appears.   

CoreWeave is bleeding cash and borrowing to build

CoreWeave saw its net loss more than double to about $315 million in its latest reported quarter.

A key driver? Interest expenses, which ballooned by 549% year-over-year to $264 million.

This staggering figure reflects the company’s growing reliance on asset-backed financing to fund its aggressive data center, an inherently risky strategy for the current rate environment.

Management has guided for a massive $20–$23 billion in capital expenditures in 2025 alone, a sum that dwarfs the company’s annual revenue by roughly 5x.

Simply put, CoreWeave is spending far more than it’s making, and financing that gap with debt tied to physical infrastructure – a setup that can unravel quickly if cash flows stumble or interest rates push up.

Even more concerning is the fragility of those cash flows. CoreWeave’s business is dangerously concentrated: Microsoft accounted for a staggering 62% of its 2024 revenue.

While its new deal with OpenAI may help diversify its customer base, the broader risk remains – if just one of its hyperscaler clients pulls back or builds in-house capacity, CoreWeave’s financial model could crack under pressure, potentially leading to a significant decline in CRWV share price.

CRWV shares are pricier than Nvidia, with none of the profits

Following today’s rally, CoreWeave Inc. has transformed into a $71 billion behemoth. Yet, it’s still operating at a loss and is not expected to reach profitability until 2026.

Analysts project continued triple-digit growth, but even those bullish expectations don’t seem to justify the AI stock’s current valuation. To compare: Nvidia, which trades at about 39x forward earnings, is solidly profitable, dominant in AI hardware, and generates free cash flow.

CoreWeave, by contrast, trades at a significantly higher multiple (forward sales) – some estimates peg it above 25x 2024 revenue, with negative earnings and heavy reliance on external financing.

Such a valuation may make sense in a zero-rate world flush with easy money.

But in today’s environment, where capital is expensive and competition from deep-pocketed hyperscalers looms large, CoreWeave stock looks more like a speculative flyer than a foundational play on AI.

Is it worth buying CoreWeave stock?

CoreWeave’s stock is red-hot, but the fundamentals show cracks beneath the surface.

Soaring debt, rising interest expenses, and dangerous customer concentration make this a high-wire act with little margin for error.

For investors chasing AI infrastructure exposure, there are safer ways to play the theme.

Unless you’re comfortable with massive volatility and the very real risk of a reversal, now might be the time to take profits before the engine overheats.

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Automakers worldwide voiced concerns alongside US manufacturers on Tuesday regarding China’s dominance over critical minerals, Reuters reported. 

The companies warned that China’s export restrictions on rare earth alloys, mixtures, and magnets risk causing significant production delays and shutdowns unless swift remedies are implemented. 

This situation has amplified anxieties about China’s control of these vital resources.

Recent export restrictions imposed by China are sparking concerns among major industries. 

Warnings across the globe

German car manufacturers have recently voiced apprehensions, stating these restrictions could lead to production halts and negatively impact their local economies, according to the Reuters report. 

This follows similar warnings issued the previous week by an Indian electric vehicle producer.

In April, China disrupted global supply chains essential for automakers, aerospace, semiconductor, and defense industries by halting exports of numerous vital minerals and magnets.

China’s control over the critical mineral sector is highlighted by this action, which is perceived as a bargaining chip in its current trade dispute with US President Donald Trump.

Trump aimed to reshape trade with China, America’s primary economic competitor.

He levied significant tariffs on billions in Chinese imports, intending to reduce a substantial trade deficit and revitalize domestic manufacturing.

Amid market upheaval across stocks, bonds, and currencies sparked by sweeping tariffs against China reaching up to 145%, Trump subsequently reduced these levies. 

In retaliation, China implemented its own tariffs and is utilizing its prominent position within essential supply chains to pressure Trump into concessions.

US-China meeting this week

White House spokeswoman Karoline Leavitt announced to reporters on Tuesday that Trump and China’s President Xi Jinping are scheduled to discuss matters this week. 

The anticipated export ban is expected to be a key topic during their conversation.

“I can assure you that the administration is actively monitoring China’s compliance with the Geneva trade agreement,” she said. 

Our administration officials continue to be engaged in correspondence with their Chinese counterparts.

Trump had previously suggested that China’s gradual lifting of the export ban on critical minerals breaches the Geneva agreement.

Delay in shipments

Delays at numerous Chinese ports have disrupted the shipment of magnets, a critical component in manufacturing cars, drones, robots, and missiles, as license requests undergo processing by Chinese regulatory bodies.

Anxieties are mounting in corporate boardrooms and government centers worldwide, spanning from Tokyo to Washington. 

The halting of operations has ignited these concerns. Officials are urgently exploring limited alternatives, fearing that manufacturing of vehicles and other goods might cease by the end of summer.

Hildegard Mueller, head of Germany’s auto lobby was quoted in the report:

If the situation is not changed quickly, production delays and even production outages can no longer be ruled out.

Chasing meetings

Due to concerns about supply chain disruptions, diplomats, car manufacturers, and business leaders from India, Japan, and Europe are actively trying to secure meetings with Beijing authorities. 

Their aim is to expedite the authorization of rare earth magnet exports as critical shortages loom.

A Japanese business delegation is scheduled to visit Beijing in early June to discuss trade restrictions with the Ministry of Commerce. 

Concurrently, European diplomats from nations with significant automotive sectors have requested urgent meetings with Chinese authorities in recent weeks, according to a Reuters report.

Amid concerns over securing rare earth magnet supplies from China, which Bajaj Auto in India highlighted as potentially “seriously impacting” electric vehicle production, India is planning an industry trip for automotive executives in the coming weeks.

Automaker trade group leadership expressed apprehensions to the Trump administration in a May letter, mirroring concerns raised by executives from General Motors, Toyota, Volkswagen, Hyundai, and other major manufacturers.

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China is in advanced discussions to place a major order for Airbus SE aircraft, with a deal potentially timed to coincide with a high-level diplomatic visit from European leaders next month, Bloomberg reported citing people familiar with the matter.

Officials are deliberating an order ranging from 200 to as many as 500 aircraft, spanning both narrowbody and widebody models, including the A330neo, the report said.

The size of the final deal remains fluid, and sources caution that talks may still collapse or take longer to conclude.

Airbus declined to comment, while China’s aviation authority has not responded to media queries.

If the deal reaches 500 aircraft, it would rank among the largest jet orders in aviation history and mark China’s biggest to date.

For comparison, Air India placed a landmark order in 2023 for 470 jets from both Airbus and Boeing, while IndiGo followed with a record-breaking 500-plane narrowbody order with Airbus later that year.

Strategic timing for a geopolitical message

The proposed order is expected to be unveiled during a July visit to Beijing by French President Emmanuel Macron and German Chancellor Friedrich Merz.

The timing is symbolically significant: the leaders are marking 50 years of diplomatic relations between the European Union and China.

France and Germany are also the two biggest shareholders of Airbus.

Should the deal materialise, it would allow President Xi Jinping to send a calculated signal to Washington, where President Donald Trump is gearing up for another term and vowing to reset trade rules with China.

Airbus rival Boeing Co. has remained largely shut out of Chinese commercial aviation deals in recent years, despite being the largest US exporter.

Airbus gains from Boeing’s setbacks

Beijing’s preference for Airbus has deepened in the wake of ongoing US-China tensions and Boeing’s own troubles.

Chinese regulators halted deliveries of Boeing jets in April.

The rift dates back to the Trump administration’s first term and was exacerbated by the 737 Max crisis, when China became the first country to ground the aircraft following two fatal crashes.

Further damage was inflicted earlier this year when a door plug blew out mid-flight on a Boeing jet, triggering a renewed quality crisis and investigations.

Boeing has not secured a major commercial order from China since at least 2017, while Airbus has steadily gained ground.

In 2022, China placed an order for around 300 Airbus narrowbody jets worth an estimated $37 billion.

A boost for widebody demand

Insiders say widebody aircraft could feature prominently in the prospective order, especially as the backlog for twin-aisle planes among Chinese carriers continues to shrink.

The A330neo, Airbus’s smallest widebody, is said to be a likely candidate for the fleet refresh.

The deal would be routed through China’s state-run aircraft procurement body, which typically negotiates on behalf of domestic airlines.

If confirmed, the order would underscore China’s growing alignment with European aerospace interests, even as its relationship with the US remains fraught.

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Russia’s economy has not collapsed under pressure. At least not yet. GDP still grows. Wages have risen.

Western sanctions failed to deliver the knockout blow many expected. But appearances are deceptive.

The structure that holds this war economy together is increasingly brittle, and signs are mounting that President Vladimir Putin is approaching a limit he cannot ignore.

Seven key developments over the past weeks have revealed a system in motion, but under strain. 

Putin’s wartime model has kept Russia functioning through firepower, money, and narrative control. 

But it’s now approaching the point where he may be forced to choose between financing the war and preserving internal calm.

That choice may define the next phase of this war more than any battlefield victory.

A war economy built on transfers, not productivity

The illusion of resilience is supported by massive spending. Defense now accounts for an estimated 40% of the state budget. 

Other studies have shown that the country’s military expenditures were close to 7% of its GDP, a 40% increase year-over-year.

According to reports, Russian soldiers are paid bonuses worth up to 1.5 million rubles, and their families receive “coffin money” payouts of 12 to 15 million rubles if they are killed. 

These transfers have fueled local booms in poor regions like Tuva, Buryatia, and Dagestan, where bank deposits rose by 151% and 81%, respectively.

Factories in the defense sector run 24 hours a day, and many former civilian firms were forced to retool into military production. 

Bread factories now assemble drones. Shipyards make stoves. Some benefit from this reindustrialization.

Others, like Severstal PJSC, Russia’s steel giant, are posting negative cash flows of 33 billion rubles, despite being profitable a year earlier.

This system works only because the Kremlin is aggressively propping it up. But the cost is steep. 

Oil and gas revenues are down, partly due to falling global prices and a stronger ruble, while inflation remains above 10%.

The budget deficit has tripled, and high interest rates (21%) imposed to stabilize inflation are choking private sector investment.

A banking system that is cracking

This model also hinges on financial stability, which is now being tested. 

In late May, the Kremlin-linked Center for Macroeconomic Analysis and Short-Term Forecasting (CMASF) warned of a “systemic banking crisis” in the making. 

It outlined three triggers: a depositor run, bad loans exceeding 10% of assets, or recapitalization needs greater than 2% of GDP. None have happened yet, but all are closer than before.

Liquidity is thinning. The money supply-to-monetary base ratio has surged, suggesting that banks are overleveraged. 

Volatility on the MOEX stock index has spiked, tracking investor uncertainty. 

Big corporates, including Gazprom, Norilsk Nickel, and Severstal, have canceled dividend payouts due to falling profits and rising borrowing costs. 

Rosstat reported a 6.9% decline in corporate earnings in 2024, or 15% when adjusted for inflation.

The Bank of Russia’s 21% policy rate, originally meant to contain inflation, is now stifling lending, delaying projects, and choking growth outside the war economy. 

Diplomacy remains frozen and that’s part of the strategy

Parallel to the economic tension is diplomatic paralysis. Two rounds of peace talks between Russia and Ukraine in Istanbul ended with almost no progress. 

Russia’s latest demands were near-total: Ukraine must withdraw from all occupied regions, renounce NATO, limit its military, lift martial law, and hold elections within 100 days.

All sanctions must be dropped, and no reparations should be demanded.

Ukraine refused, calling the terms political fantasy. Western officials privately agree.

Even US President Donald Trump, who staked his second-term foreign policy on ending the war, called Putin “absolutely MAD” after Russia’s recent strikes on Ukrainian cities. 

Senator Richard Blumenthal accused Russia of “mocking peace efforts” and warned the Kremlin was “playing America for fools.”

Yet Russia’s refusal to compromise is calculated. According to Dmitry Medvedev, now a senior security official, Moscow’s aim is not peace. It’s victory. 

Diplomacy has become another front in the war, designed to exhaust Ukraine’s allies, pressure US mediators, and stall just long enough for battlefield progress.

Russia knows it’s playing with fire

Beneath the silence of the Russian public lies intense state monitoring. The Kremlin’s presidential administration remains the single largest consumer of polling data in the country.

Prime Minister Mishustin’s “coordination center” tracks discontent in real time, fusing AI, social media data, and regional reports into “satisfaction maps” updated daily.

This is not paranoia. It is survival instinct. Putin witnessed two regimes collapse around him and knows that even authoritarian systems can fall quickly if the public turns.

He is aware that the illusion of stability must be maintained, not just through force, but through income and services.

This is why he has refused further mobilizations, despite military pressure. It’s also why the government continued spending on mortgage subsidies and consumer protection programs until recently. 

These programs are now being scaled back. Most subsidies are gone. Growth is slowing. Wages for new hires have stalled. The internal trade-off between war abroad and stability at home is becoming harder to afford.

What breaks first: the war machine or the social contract?

The story of Russia’s war economy is not just one of survival. It’s one of unsustainable compression. Everything has been tightened to its maximum setting. Finances, politics, military.

Real incomes are still higher than before the war, but the gains are slowing. Inflation remains high, and interest rates are suffocating real investment. 

The Kremlin cannot keep writing large checks to soldiers’ families and regional governments forever.

On the battlefield, Ukraine is far from defeated. Its long-range drone attacks on strategic Russian bombers in Siberia and the Arctic show it has capabilities that can strike beyond the front lines. 

These small victories reveal a resilience and technical depth that complicates Russia’s path to escalation.

Putin is not facing collapse. But he is facing choices. Keep spending on the war and risk economic collapse. Cut spending and risk public unrest. Attempt another mobilization and risk his grip on power. 

Russia is prepared to fight for as long as it takes. Any real hope for peace now rests on external powers.

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European stock markets demonstrated resilience at Wednesday’s open, trading higher despite the official implementation of US President Donald Trump’s doubled tariffs on steel imports.

While the broader market found positive momentum, the steel sector itself braced for a mixed impact, with analysts predicting potential benefits for European buyers but significant pressure on regional producers.

Shortly after the opening bell in London, European equities were broadly in positive territory.

The pan-European Stoxx 600 index opened nearly 0.3% higher, signaling investor appetite despite the heightened trade tensions.

Germany’s DAX led the gains, climbing 0.6%, while the French CAC 40 was 0.3% higher. London’s FTSE 100, however, was little changed in early dealings. Most major sectors across the European bourses started the day in the green.

The primary focus for markets on Wednesday is the activation of US tariffs.

Last week, President Donald Trump announced his decision to double the tariffs on steel imports from 25% to 50%, with the new rate taking effect on June 4.

This move has drawn criticism from the European Union, which stated that such an action “undermines” its ongoing trade deal negotiations with the US.

Steel sector braces for tariff impact

The implementation of these higher US tariffs is expected to have a complex and somewhat divergent impact on the European steel industry.

While seemingly counterintuitive, some analysts suggest that European steel buyers and certain manufacturers could paradoxically benefit from the increased US duties.

The logic is that these tariffs could put downward pressure on steel prices within the European region itself.

Josh Spoores, head of steel Americas analysis at CRU, explained to CNBC on Tuesday that the latest US tariffs will cause domestic steel prices in the US to increase.

This, in turn, will put pressure on Canada and Mexico, which are the largest steel exporters to the US.

Consequently, Spoores anticipates that this will redirect steel flows towards cheaper markets, such as Europe, thereby potentially favoring regional buyers with lower input costs.

However, the outlook for European steelmakers is less optimistic.

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