GF Securities Overseas Electronics and Communications: CoreWeave 2Q26 Earnings Comment Maintaining Buy rating and $172 target price: CoreWeave posted 2Q26 revenue of $2.6 billion and adjusted EBITDA of $1.5 billion, both above consensus. The company currently operates 1.5GW of compute power, and contracted capacity stands at 4.2GW, keeping it on track toward its 8GW target for 2030. Management guided to midpoints of $230 million for 3Q26 adjusted operating income and $1,055 million for full year 2026. That implies 4Q26 operating income of roughly $770 million at the top end of guidance, pointing to a very strong fourth quarter. We remain positive on CoreWeave for the following reasons. 1) With AI infrastructure demand strong and cash flow pressure building at the major cloud operators, the market for emerging cloud service providers continues to expand. 2) Pricing power keeps strengthening, and the company raised prices across all products by 25% starting in July. 3) The backlog stands at $129 billion, giving very high earnings visibility. 4) The launch of the DDTL 5.5 financing structure has made financing available even for contracts as short as three years. Shorter contracts generally carry higher prices. The company raised its 2026 capex guidance to $35 billion to $39 billion, but the 2Q26 EBITDA improvement and continued power capacity expansion have eased market concerns to some degree. We forecast revenue of $12.7 billion, $27.3 billion and $41.8 billion for 2026, 2027 and 2028, and adjusted EBITDA of $7.5 billion, $15.6 billion and $21.2 billion. Our $172 target price is unchanged and is derived by applying 10x 2028 estimated EV/EBITDA. A direct beneficiary of the expanding emerging cloud market: The market is concerned that the entry of new players such as Meta and SpaceX will intensify competition and disperse demand. We judge, however, that the current buildout plans of these players are not enough to resolve the structural shortage of compute resources. More importantly, the long term take-or-pay contracts CoreWeave signs offer greater revenue stability than on demand rentals or short term contracts. The company's total operating costs are also up to 47% lower than the average hyperscaler, giving it a clear edge in cost and operating efficiency. The path to margin improvement is on track as well. 1. As we noted in our initiation report, new bookings are capturing the full benefit of higher GPU rental rates. According to management, margins on 2Q26 new contracts are 5 to 10 percentage points higher than on existing contracts. On top of that, with the 25% across the board price increase in July, the $25 billion of new contracts to be signed in 3Q26 will carry even higher pricing. 2. The model of continuing to monetize assets after contracts expire is delivering. Some A100 GPUs deployed in 2020 are already contracted out through 2029. 3. The push into the Asia Pacific market is also accelerating. The company has secured 360MW of compute capacity in Indonesia, where low local data center operating costs should further improve profitability. $CRWV

GF Securities Overseas Electronics and Communications: CoreWeave 2Q26 Earnings Comment Maintaining Buy rating and $172 target price: CoreWeave posted 2Q26 revenue of $2.6 billion and adjusted EBITDA of $1.5 billion, both above consensus. The company currently operates 1.5GW of compute power, and contracted capacity stands at 4.2GW, keeping it on track toward its 8GW target for 2030. Management guided to midpoints of $230 million for 3Q26 adjusted operating income and $1,055 million for full year 2026. That implies 4Q26 operating income of roughly $770 million at the top end of guidance, pointing to a very strong fourth quarter. We remain positive on CoreWeave for the following reasons. 1) With AI infrastructure demand strong and cash flow pressure building at the major cloud operators, the market for emerging cloud service providers continues to expand. 2) Pricing power keeps strengthening, and the company raised prices across all products by 25% starting in July. 3) The backlog stands at $129 billion, giving very high earnings visibility. 4) The launch of the DDTL 5.5 financing structure has made financing available even for contracts as short as three years. Shorter contracts generally carry higher prices. The company raised its 2026 capex guidance to $35 billion to $39 billion, but the 2Q26 EBITDA improvement and continued power capacity expansion have eased market concerns to some degree. We forecast revenue of $12.7 billion, $27.3 billion and $41.8 billion for 2026, 2027 and 2028, and adjusted EBITDA of $7.5 billion, $15.6 billion and $21.2 billion. Our $172 target price is unchanged and is derived by applying 10x 2028 estimated EV/EBITDA. A direct beneficiary of the expanding emerging cloud market: The market is concerned that the entry of new players such as Meta and SpaceX will intensify competition and disperse demand. We judge, however, that the current buildout plans of these players are not enough to resolve the structural shortage of compute resources. More importantly, the long term take-or-pay contracts CoreWeave signs offer greater revenue stability than on demand rentals or short term contracts. The company's total operating costs are also up to 47% lower than the average hyperscaler, giving it a clear edge in cost and operating efficiency. The path to margin improvement is on track as well. 1. As we noted in our initiation report, new bookings are capturing the full benefit of higher GPU rental rates. According to management, margins on 2Q26 new contracts are 5 to 10 percentage points higher than on existing contracts. On top of that, with the 25% across the board price increase in July, the $25 billion of new contracts to be signed in 3Q26 will carry even higher pricing. 2. The model of continuing to monetize assets after contracts expire is delivering. Some A100 GPUs deployed in 2020 are already contracted out through 2029. 3. The push into the Asia Pacific market is also accelerating. The company has secured 360MW of compute capacity in Indonesia, where low local data center operating costs should further improve profitability. $CRWV

Source:https://x.com/jukan05/status/2087732870521757855