CoreWeave small group meeting notes (Part 2)

Key Takeaways：

• CoreWeave’s average EBITDA margins per contract range from 65% to 90%, with a weighted average of ~80%, allowing predictable payback—around 2.5 years on average.

• Current structure uses ~85% loan-to-cost via SPVs, minimizing parent equity needs.

  • These structures amortize like mortgages, with no reliance on customer renewal to repay debt. Contracts are highly specific—locked to particular infrastructure SKUs (e.g., GB200)—and non-cancellable, giving high financing confidence.

• Recent deals show ~40% levered IRRs with 2.5-year payback periods.

• Depreciation (6 years) extends beyond contract duration (typically 4 years).

• CoreWeave repays debt by year 3, generating free cash flow from year 4 onward > Significant equity upside exists in years 5–6 and beyond through re-contracting.

• The company is targeting investment-grade credit within three years and plans to leverage growing free cash flow from SPV dividend streams.

Q&A

1. Why does CoreWeave prioritize debt over equity for financing growth?