Jim Cramer says investors need to pay attention to CoreWeave. Here's why - CNBC

CNBC's Jim Cramer said Wednesday that he's becoming less skeptical of CoreWeave after the neocloud's strong earnings and the CEO's "refreshing and reassuring" comments.

CoreWeave shares surged nearly 25% on Wednesday after the company reported better-than-expected quarterly revenue and raised its 2026 guidance. The results, which were out Tuesday evening, helped ease concerns about a slowdown in AI infrastructure spending. CoreWeave CEO Michael Intrator's subsequent interview with Cramer on CNBC just after Wall Street's opening bell offered further reasons for optimism.

One of the most encouraging takeaways from Intrator was disclosure that demand for CoreWeave's computing capacity is 10 times greater than what the company can supply. It was also discussed on the post-earnings conference call. That dynamic has allowed CoreWeave to consistently increase prices, supporting stronger gross margins even as it spends heavily to expand its infrastructure.

Intrator also addressed concerns about CoreWeave's substantial debt load, which has weighed heavily on its stock. Despite Wednesday's surge, shares are still down 15% year to date and down 55% from its 52-week high of $138 on May 6. The past month has been particularly tumultuous for the neoclouds, which also include Iren and Nebius. Iren reported strong earnings last week. Nebius reports its quarter Thursday morning.

Rather than relying solely on traditional bond markets, CoreWeave has increasingly turned to financing backed by its equipment and customer contracts. "When I pressed him, asking why he doesn't just go into the open market and buy these bonds that are trading so poorly, he admitted that he's been tempted to, but ultimately he still believes he can make an even better return building data centers," Cramer said. "Take that red flag off the table."

Another surprising revelation involved the value of CoreWeave's Nvidia chips. Intrator said some H100 chips purchased four years ago are now being contracted at premiums of 20% to 50% above its original cost, suggesting the equipment is retaining its economic value longer than many investors anticipated.

The Intrator interview also helped ease concerns about growing political opposition to data center construction. The CEO maintained that demand for computing power would continue to drive expansion, even if stricter regulations pushed some projects overseas.

For Cramer, the comments offered a welcome counterpoint to the recent pessimism surrounding AI infrastructure stocks. While he has grown more cautious about the sector amid political and financing risks, the "Mad Money" host maintained that abandoning it altogether could mean missing substantial upside. "We've taken some data center and related stocks off the table, unfortunately not Nvidia, [for the CNBC Investing Club] because our composure and our prudence dictates that to have too much data center is still too dicey. Still, we've left plenty of exposure to the group, which includes semis, software, networking, builders, turbines and cooling equipment, because we think the AI theme has much more room to run."

The Club does not own any neoclouds. But it does have diversified, albeit recently reduced, exposure to the AI boom via chip stocks and names that help run and power data centers.

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