Source: Motley Fool transcript (published 08/18/2026)
Operator: Hello, everyone. Thank you for joining us, and welcome to CoreWeave's Second Quarter 2026 Earnings Call. [Operator Instructions] I will now hand the conference over to CoreWeave. Please go ahead.
Unknown Executive: Thank you. Good afternoon, and welcome to CoreWeave's Second Quarter 2026 Earnings Conference Call. Joining the call today to discuss our results are Mike Intrator, CEO; and Nitin Agrawal, CFO. Before we get started, I would like to take this opportunity to remind you that our remarks today will include forward-looking statements. Actual results may differ materially from those contemplated by these forward-looking statements. During this call, we will present both GAAP and certain non-GAAP financial measures. A reconciliation of GAAP to non-GAAP measures is included in today's earnings press release. And now I'd like to turn the call over to Mike.
Michael Intrator, CEO: Good afternoon, everyone, and thank you for joining us. Q2 was an exceptional quarter for CoreWeave. We outperformed our plan across the board with the operating leverage we have been building beginning to show up clearly in our results. Extraordinary execution across the organization drove record financial performance, rapid capacity growth, broadening customer demand and continued platform innovation.
We generated record revenue of $2.6 billion, up 112% year-over-year. Increased revenue backlog to $104.2 billion while driving rapidly expanding enterprise adoption. This figure does not include the over $25 billion of net new customer commitments added in the early weeks of Q3. We continue to execute on our power strategy, reaching 1.5 gigawatts of active power, adding nearly 500 megawatts, more than any quarter in our history and more than tripling year-over-year. We remain firmly on track to reach at least 8 gigawatts by 2030. We grew adjusted operating income to $128 million, with margins expanding meaningfully as our scale increasingly translates into operating leverage.
In Q2, the customer contracts we signed came with contribution margins we expect to be 5 to 10 percentage points above those added in recent quarters. Demand continues to intensify as the market broadens across sectors, geographies, workloads and generations of GPU architecture. AI is no longer confined to frontier model labs. Pricing and margins for our Blackwell and Vera Rubin SKUs are setting new highs, while pricing for prior generation SKUs is at or above where it was years ago. Our near-term capacity remains effectively sold out.
Caterpillar is a powerful example — together, we will deploy NVIDIA's Vera Rubin platform to support Caterpillar's physical AI training and inference at industrial scale. Life sciences is emerging as another important growth vertical. We recently welcomed Isomorphic Labs as a new customer. Financial services remains a major growth area — we recently added Flow Traders and IMC to our growing roster of systematic trading firms. And in the public sector, our collaboration with Leidos marks an important step in the growth of CoreWeave Federal.
In Q2, we introduced 7 new AI platform capabilities and achieved multiple industry firsts. Just this week, we surpassed 1 billion model training runs tracked on our platform. Our managed inference platform has seen an explosion of growth in the few months since its launch, with growth constrained only by our near-term capacity. In the past few months since its launch, booked ARR for our managed inference platform has grown from $1 million to more than $100 million. We expect to exit 2026 with at least $250 million of managed inference ARR.
In Q2, we became the first cloud provider to bring up and validate NVIDIA's Vera Rubin NVL72, leveraging our innovations in software-defined liquid cooling and rack management. We also set new MLPerf records for training and inference with open source models. According to Signal65, CoreWeave delivers total cost of ownership estimated to be up to 47% lower than the average hyperscaler. In July, Gartner named CoreWeave a visionary in its 2026 Magic Quadrant for Cloud AI infrastructure.
We ended Q2 with 1.5 gigawatts of active power, adding close to 500 megawatts in the quarter alone — more power in Q2 than any single neo-cloud operates in total today. Contracted power grew to 3.7 gigawatts in Q2, and since quarter end, we have added roughly 500 megawatts, bringing contracted power to 4.2 gigawatts as of today. Our first several self-builds are already well underway, including our first site expected to come online later this year. We have contracted more than 1 gigawatt of power outside the United States, including recently entering the APAC region with 360 megawatts in Indonesia.
Nitin Agrawal, CFO: Thanks, Mike, and good afternoon, everyone. Q2 was an exceptional quarter for CoreWeave marked by intense customer demand, significant ramp of our active capacity and continued execution against our product and financing road maps. Perhaps most importantly, Q2 marked the quarter in which we saw margins inflect, expanding sequentially.
Demand for CoreWeave Cloud remains exceptionally strong across the entirety of our customer base, with demand from multiple customers for each GPU we bring online. The scale of our AI products and services beyond GPUs also continues to ramp significantly. These margin-accretive businesses including storage, CPU, networking and software already exceed $400 million of ARR as of Q2.
This operating margin improvement came before our July pricing changes which included an approximately 25% increase across SKUs in response to the current demand environment. We are also passing through component price increases. A typical 5-year contract carries strong and still-expanding unit economics across its term, but those economics do not arrive evenly — CapEx is front-loaded requiring a combination of debt, customer prepayments, and other corporate level capital to finance its build out.
We recently signed an A100 contract that extends into 2029 at an attractive price. As a reminder, this SKU was introduced in 2020. In a market where new capacity is supply constrained and costs are rising, AI cloud infrastructure in production is a scarce, valuable asset.
Now turning to Q2 results. Revenue was $2.6 billion in Q2, up 112% year-over-year and 24% sequentially. Revenue backlog ended the quarter at $104.2 billion, up 246% year-over-year. Of the existing backlog, more than 50% is attached to a contract where customer delivery has commenced. We expect this figure to reach more than 2/3 of our Q2 backlog by the end of this year.
Adjusted EBITDA for Q2 was $1.5 billion, doubling year-over-year, with an adjusted EBITDA margin of 59%. Adjusted operating income for Q2 was $128 million, well above the high end of our guidance, with an adjusted operating margin of 5%. Margins expanded as we scaled despite continuing to incur significant ramp costs. Net loss for Q2 was $626 million. Interest expense for Q2 was $640 million, driven by increased debt to support the continued scaling of our infrastructure.
Turning to capital expenditures. CapEx in Q2 totaled $9.4 billion, slightly above the high end of our guided range. Construction in progress increased to $11.9 billion from $9.6 billion quarter-over-quarter. In June, we brought on more than 300 megawatts of active power, which makes June itself larger than any full quarter in our history.
As of June 30, we had more than $6.9 billion in cash, cash equivalents, restricted cash and marketable securities. In Q2, we raised approximately $18 billion across a combination of debt, convertibles and equity. These transactions bring us to over $32 billion of debt and equity capital secured to date. Over the past year, we have reduced our weighted average cost of debt by almost 300 basis points, representing approximately $1.1 billion of annualized interest savings.
Turning to guidance. We now expect to end the year with more than 1.85 gigawatts of active power, up from our previous guidance of more than 1.7 gigawatts. We expect Q3 revenue to be in the range of $3.45 billion to $3.6 billion. We expect Q3 adjusted operating income of $200 million to $260 million as margins continue to sequentially expand reaching low teens in Q4. Q3 interest expense is expected to be in the range of $860 million to $940 million. We expect CapEx to be $11.5 billion to $13.5 billion.
Moving to full year. We are raising our full year 2026 revenue guidance to $12.4 billion to $13.2 billion and adjusted operating income to $960 million to $1.15 billion. We now expect 2026 CapEx in the range of $35 billion to $39 billion. We're also raising our expected end of year annualized run rate revenue to $18.5 billion to $19.5 billion.