Backblaze Secures $335M Deal with CoreWeave for AI Storage
Written by Emily J. Thompson, Senior Investment Analyst
Updated: Jun 23 2026
0mins
Source: seekingalpha
- Deal Value: Backblaze has secured a five-year deal worth $335 million with CoreWeave to enhance its managed storage infrastructure, which is crucial for optimizing data placement across performance tiers, thereby significantly boosting Backblaze's competitive edge in the AI storage market.
- Stock Reaction: Following the announcement, Backblaze's shares surged 30% in early trading on Tuesday, reflecting strong market confidence in its growth potential, while CoreWeave's shares dipped about 2%, indicating a more cautious investor sentiment regarding its future outlook.
- Market Opportunity: Backblaze estimates a $14 billion opportunity in the neocloud storage market by 2030, having engaged with most top neoclouds and signed multiple six-, seven-, and eight-figure deals, showcasing its robust positioning in the rapidly growing AI-driven infrastructure sector.
- Industry Context: As AI workloads increasingly demand efficient storage solutions, Backblaze's HDD-based storage infrastructure is deemed foundational for AI workflows, with CEO Gleb Budman emphasizing the critical role of storage in AI computing, further solidifying its market position.
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Analyst Views on CRWV
Wall Street analysts forecast CRWV stock price to rise
25 Analyst Rating
12 Buy
13 Hold
0 Sell
Moderate Buy
Current: 85.685
Low
68.00
Averages
123.23
High
180.00
Current: 85.685
Low
68.00
Averages
123.23
High
180.00
About CRWV
CoreWeave, Inc. is a cloud infrastructure technology company. The Company offers the CoreWeave Cloud Platform, which consists of software and cloud services that deliver the automation and efficiency needed to manage complex artificial intelligence (AI) infrastructure. Its CoreWeave Cloud Platform is an integrated solution that is purpose-built for running AI workloads such as model training and inference. Its solutions include infrastructure services, managed software services, and application software services. Its Infrastructure Services provide its customers with access to advanced graphics processing unit (GPU) and central processing unit (CPU) compute, highly performant networking, and storage. Its Managed Software Services include CKS, a flexible virtual private cloud and a bare metal service that runs kubernetes directly on high-performance servers. Its Application Software Services build on top of its infrastructure and managed software services, integrating additional tools.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
Analyzing New AI Investment Opportunities
- Massive Market Potential: Nebius and CoreWeave are rapidly emerging in the neocloud space, with Nebius's Q1 revenue soaring 684% year-over-year, and projected growth of 547% in 2026 and 233% in 2027, indicating strong market demand and growth potential.
- Key Partnerships: Both companies have established significant partnerships with Microsoft and Meta, backed by Nvidia, which not only enhances their market credibility but also lays a solid foundation for future business expansion.
- Revenue Growth Trends: CoreWeave's Q1 revenue increased by 112% to $2.1 billion, with a revenue backlog nearing $100 billion, and expected growth rates of 147% in 2026 and 98% in 2027, showcasing its strong competitive position in the market.
- Investment Risk Warning: Despite the significant growth potential, both companies face risks due to lack of profitability and high infrastructure investment needs, leading to shareholder dilution and rising debt levels, necessitating careful risk assessment by investors.
See More
CoreWeave and Nebius Rapid Growth Amid Rising Debt
- Significant Revenue Growth: Nebius reported a staggering 684% year-over-year revenue increase in Q1, with projections of 547% growth in 2026 and 233% in 2027, indicating strong demand and market potential in the AI application sector.
- Key Client Partnerships: Both Nebius and CoreWeave have established crucial partnerships with Microsoft and Meta, backed by Nvidia, which enhances their market position and client trust.
- Increasing Financial Risks: Both companies are heavily investing in data centers to support rapid expansion, but lacking a base business revenue, they must raise funds through stock issuance or debt, leading to shareholder dilution and rising debt levels.
- Uncertain Market Outlook: While both companies show immense growth potential in AI computing, their lack of profitability introduces significant execution risks, necessitating cautious evaluation of their future success prospects.
See More
CoreWeave Stock Plummets 24% Amid Competitive Pressures
- Significant Stock Decline: CoreWeave's stock has plunged approximately 24% over the past month, significantly underperforming the Zacks Internet Software Market's 3.4% decline, indicating a reassessment of its lofty valuations and competitive risks by investors.
- Intensifying Competitive Risks: Meta's exploration of commercializing its excess AI computing capacity poses a potential threat as it could turn from a major customer into a direct competitor for CoreWeave, raising concerns about increasing competition in the AI infrastructure space.
- Rising Financial Pressures: As of March 31, 2026, CoreWeave's long-term debt totaled $25.4 million, with interest expenses expected to rise to as much as $730 million in the second quarter due to increased funding needs, leading to higher leverage.
- Revenue Growth Potential: Despite challenges, CoreWeave reported over 100% year-over-year revenue growth in Q1 2026, projecting revenues of $12-$13 billion for the year, highlighting strong demand and long-term growth potential in the AI infrastructure market.
See More
Meta's Cloud Ambitions Pose Threat to Amazon
- Market Reaction: The news of Meta's cloud computing plans triggered market fluctuations, with Meta's stock rising while Amazon's shares modestly increased to $241.70, indicating continued investor confidence in Amazon despite potential competition.
- Strong AWS Performance: Amazon Web Services (AWS) achieved a 28% year-over-year growth in Q1 2026, generating $37.6 billion in revenue, showcasing its robust competitive position in the cloud market despite the looming threat from Meta.
- Profit Contribution: AWS contributed $14.2 billion in operating income during the quarter, accounting for nearly 60% of Amazon's total operating income, despite representing only one-fifth of the company's total sales, highlighting its critical role in profitability.
- Investment and Cash Flow: Amazon's free cash flow fell to $1.2 billion over the past 12 months, primarily due to a $59.3 billion increase in investments in AI, reflecting the company's proactive stance on expanding cloud capabilities despite competitive pressures.
See More
Meta Plans to Enter Cloud Computing Market
- Increased Cloud Competition: Meta is reportedly developing a cloud service to rent out its AI computing power, directly competing with Amazon Web Services (AWS), which saw a 28% year-over-year revenue growth to $37.6 billion in Q1 2026, indicating strong market demand.
- AWS Profitability: Despite accounting for only one-fifth of Amazon's $181.5 billion in net sales, AWS generated $14.2 billion in operating income during Q1, nearly 60% of Amazon's total operating income of $23.9 billion, highlighting its critical role in the company's profitability.
- Investment and Cash Flow Pressure: Amazon's free cash flow fell to $1.2 billion over the past 12 months, primarily due to a $59.3 billion increase in investments in AI, indicating that the company is reinvesting all its earnings into new capacity, reflecting confidence in future market demand.
- Market Risks and Opportunities: Meta's cloud service plans could lead to an oversupply of AI computing capacity, which may weaken pricing power across the industry if tech giants overbuild, although Amazon's market position remains strong, with projected net sales growth of 16% to 19% for Q2.
See More
U.S. Stocks Mixed Close, Nasdaq Drops 1.6%
- Employment Data Impact: U.S. nonfarm payrolls increased by a seasonally adjusted 57,000 in June, significantly below the expected 115,000, indicating slower labor market growth, which led to a decline in rate hike expectations and eased investor anxiety.
- Rate Hike Odds Drop: According to the CME FedWatch tool, the odds of a 25-basis-point rate hike fell to 17.6% from 28.9% the previous day, reflecting reduced concerns over a hawkish stance from the Fed, potentially providing support for risk assets.
- Mixed Index Performance: The Dow Jones Industrial Average rose 1.1% to 52,900.07, hitting a record high, while the Nasdaq 100 dropped 1.6% to 29,329.21, indicating ongoing investor rotation out of semiconductor stocks.
- ETF Movements: The SPDR S&P 500 ETF (SPY) fell 0.7%, the Invesco QQQ Trust (QQQ) declined approximately 1.6% for the second consecutive day, while the SPDR Dow Jones Industrial Average ETF (DIA) increased by 1%, reflecting differing sentiments across market segments.
See More
Analyzing New AI Investment Opportunities
- Massive Market Potential: Nebius and CoreWeave are rapidly emerging in the neocloud space, with Nebius's Q1 revenue soaring 684% year-over-year, and projected growth of 547% in 2026 and 233% in 2027, indicating strong market demand and growth potential.
- Key Partnerships: Both companies have established significant partnerships with Microsoft and Meta, backed by Nvidia, which not only enhances their market credibility but also lays a solid foundation for future business expansion.
- Revenue Growth Trends: CoreWeave's Q1 revenue increased by 112% to $2.1 billion, with a revenue backlog nearing $100 billion, and expected growth rates of 147% in 2026 and 98% in 2027, showcasing its strong competitive position in the market.
- Investment Risk Warning: Despite the significant growth potential, both companies face risks due to lack of profitability and high infrastructure investment needs, leading to shareholder dilution and rising debt levels, necessitating careful risk assessment by investors.
See More
CoreWeave and Nebius Rapid Growth Amid Rising Debt
- Significant Revenue Growth: Nebius reported a staggering 684% year-over-year revenue increase in Q1, with projections of 547% growth in 2026 and 233% in 2027, indicating strong demand and market potential in the AI application sector.
- Key Client Partnerships: Both Nebius and CoreWeave have established crucial partnerships with Microsoft and Meta, backed by Nvidia, which enhances their market position and client trust.
- Increasing Financial Risks: Both companies are heavily investing in data centers to support rapid expansion, but lacking a base business revenue, they must raise funds through stock issuance or debt, leading to shareholder dilution and rising debt levels.
- Uncertain Market Outlook: While both companies show immense growth potential in AI computing, their lack of profitability introduces significant execution risks, necessitating cautious evaluation of their future success prospects.
See More
CoreWeave Stock Plummets 24% Amid Competitive Pressures
- Significant Stock Decline: CoreWeave's stock has plunged approximately 24% over the past month, significantly underperforming the Zacks Internet Software Market's 3.4% decline, indicating a reassessment of its lofty valuations and competitive risks by investors.
- Intensifying Competitive Risks: Meta's exploration of commercializing its excess AI computing capacity poses a potential threat as it could turn from a major customer into a direct competitor for CoreWeave, raising concerns about increasing competition in the AI infrastructure space.
- Rising Financial Pressures: As of March 31, 2026, CoreWeave's long-term debt totaled $25.4 million, with interest expenses expected to rise to as much as $730 million in the second quarter due to increased funding needs, leading to higher leverage.
- Revenue Growth Potential: Despite challenges, CoreWeave reported over 100% year-over-year revenue growth in Q1 2026, projecting revenues of $12-$13 billion for the year, highlighting strong demand and long-term growth potential in the AI infrastructure market.
See More
Meta's Cloud Ambitions Pose Threat to Amazon
- Market Reaction: The news of Meta's cloud computing plans triggered market fluctuations, with Meta's stock rising while Amazon's shares modestly increased to $241.70, indicating continued investor confidence in Amazon despite potential competition.
- Strong AWS Performance: Amazon Web Services (AWS) achieved a 28% year-over-year growth in Q1 2026, generating $37.6 billion in revenue, showcasing its robust competitive position in the cloud market despite the looming threat from Meta.
- Profit Contribution: AWS contributed $14.2 billion in operating income during the quarter, accounting for nearly 60% of Amazon's total operating income, despite representing only one-fifth of the company's total sales, highlighting its critical role in profitability.
- Investment and Cash Flow: Amazon's free cash flow fell to $1.2 billion over the past 12 months, primarily due to a $59.3 billion increase in investments in AI, reflecting the company's proactive stance on expanding cloud capabilities despite competitive pressures.
See More
Meta Plans to Enter Cloud Computing Market
- Increased Cloud Competition: Meta is reportedly developing a cloud service to rent out its AI computing power, directly competing with Amazon Web Services (AWS), which saw a 28% year-over-year revenue growth to $37.6 billion in Q1 2026, indicating strong market demand.
- AWS Profitability: Despite accounting for only one-fifth of Amazon's $181.5 billion in net sales, AWS generated $14.2 billion in operating income during Q1, nearly 60% of Amazon's total operating income of $23.9 billion, highlighting its critical role in the company's profitability.
- Investment and Cash Flow Pressure: Amazon's free cash flow fell to $1.2 billion over the past 12 months, primarily due to a $59.3 billion increase in investments in AI, indicating that the company is reinvesting all its earnings into new capacity, reflecting confidence in future market demand.
- Market Risks and Opportunities: Meta's cloud service plans could lead to an oversupply of AI computing capacity, which may weaken pricing power across the industry if tech giants overbuild, although Amazon's market position remains strong, with projected net sales growth of 16% to 19% for Q2.
See More
U.S. Stocks Mixed Close, Nasdaq Drops 1.6%
- Employment Data Impact: U.S. nonfarm payrolls increased by a seasonally adjusted 57,000 in June, significantly below the expected 115,000, indicating slower labor market growth, which led to a decline in rate hike expectations and eased investor anxiety.
- Rate Hike Odds Drop: According to the CME FedWatch tool, the odds of a 25-basis-point rate hike fell to 17.6% from 28.9% the previous day, reflecting reduced concerns over a hawkish stance from the Fed, potentially providing support for risk assets.
- Mixed Index Performance: The Dow Jones Industrial Average rose 1.1% to 52,900.07, hitting a record high, while the Nasdaq 100 dropped 1.6% to 29,329.21, indicating ongoing investor rotation out of semiconductor stocks.
- ETF Movements: The SPDR S&P 500 ETF (SPY) fell 0.7%, the Invesco QQQ Trust (QQQ) declined approximately 1.6% for the second consecutive day, while the SPDR Dow Jones Industrial Average ETF (DIA) increased by 1%, reflecting differing sentiments across market segments.
See More
