Cathie Wood Increases Stake in CoreWeave Despite Declining Share Value

Cathie Wood, founder and CEO of Ark Investment Management, has purchased an additional 136,000 shares of CoreWeave Inc. (NASDAQ: CRWV) this week, despite the company's shares having halved in value over the last six months.

CoreWeave's significant drop follows Oracle's earnings report, which suggested potential challenges in AI investments. The company's capital-intensive business model, heavily reliant on debt financing, raises concerns about its sustainability, as its operating margin is approximately 4.0%, while borrowing costs are at 7.5%.

CoreWeave has also cut revenue and operating profit forecasts due to delays in data center construction, leading to unattractive long-term investment prospects. Despite this, Wall Street maintains an