Could CRWV fall another 50%?
Meta's move into AI cloud infrastructure is a reminder that the biggest competitive risk to neocloud providers isn't demand it's the hyperscalers becoming suppliers themselves.
If Meta begins commercializing excess AI compute, it adds another deep-pocketed player with virtually unlimited capital, proprietary chips, and world-class infrastructure. That puts pricing power and margins across the neocloud ecosystem under pressure. Investors have been valuing companies like CoreWeave (CRWV) on scarcity; if supply expands materially, that premium can compress quickly. Today's market reaction reflects that concern.
Could CRWV fall another 50%? It's possible if investors conclude that long-term pricing power, utilization, or customer concentration will deteriorate. However, that outcome is far from certain. AI compute demand remains exceptionally strong, and it is not yet clear how aggressively Meta will compete or how much excess capacity it will actually bring to market.
For now, the news increases uncertainty and likely warrants lower valuation multiples not necessarily a collapse in the underlying business.