Investors have piled into artificial intelligence (AI) stocks over the past couple of years, especially big names such as AI chip leader Nvidia or cloud giant Amazon. Though these companies have helped shareholders score a major win quarter after quarter and could continue to climb, some investors now are looking beyond these names that have constantly been on center stage. They aim to find the next big AI success story, and one that has emerged in recent times is CoreWeave (CRWV +5.86%).
This tech company is new to the market, having launched its initial public offering in March, and the stock already has soared more than 320% from that point. Investors are excited about this new AI investing opportunity, especially considering the company has been delivering triple-digit revenue growth. Could investing $10,000 in CoreWeave make you a millionaire? Let's find out.
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Outperforming the Magnificent Seven
So, first, let's talk a little bit about this new-to-the-market company that's outperformed well-established tech giants such as the Magnificent Seven companies so far this year. CoreWeave actually is closely linked to the world's most talked-about AI company, Nvidia, and this may be part of the reason why investors are so excited about its future.
This company's main business is offering customers access to its giant fleet -- 250,000 to be exact -- of Nvidia chips across more than 30 data centers. These graphics processing units (GPUs) may be rented for long periods of time or simply by hour, offering customers great flexibility for their AI workloads. Since demand has been extremely high, even surpassing supply, for Nvidia's latest Blackwell architecture and chip, investors clearly are optimistic about CoreWeave's prospects too. CoreWeave even was the first to make this new architecture generally available to customers, highlighting its ability to serve customers fast with the latest innovations.
And the fact that market giant Nvidia holds a 7% stake in CoreWeave is another element that could appeal to investors. Nvidia's backing suggests this young company is set to play a key role in the next phases of the AI story.
Revenue gains of more than 400%
A look at CoreWeave's growth so far shows great momentum, with revenue soaring more than 400% in the first quarter. And even considering uncertainties in recent months that have pressured the stock market, CoreWeave says customer demand still increased. In fact, the big challenge right now is to scale up and meet demand. This requires significant investment, and that means investors should expect spending to increase moving forward.
NASDAQ: CRWV
Key Data Points
Of course, CoreWeave faces competition from traditional cloud service providers, but the company stands out because it truly specializes in handling AI workloads, and doing this at scale. This could work to CoreWeave's advantage as demand for compute-intense inferencing accelerates.
Now, let's get back to our question: Could investing $10,000 in CoreWeave make you a millionaire? It's clear that CoreWeave offers an interesting growth story at the moment, and even after its spectacular gains could make a compelling buy for long-term growth investors who can handle some risk. But even if CoreWeave goes on to climb 1,000% over the coming years, as tech companies have been known to do, your $10,000 would reach $110,000. This would be fantastic, but it's far from $1 million.
Before making any investment decisions, though, it's important to keep in mind that you shouldn't count on any one stock to make you a millionaire. It's extremely rare to succeed this way, and even worse, it's high risk. You have a much better chance of reaching the $1 million mark, and avoiding disastrous losses, if you invest in a diversified portfolio of quality stocks. So, for example, if $10,000 is your investing budget, split this amount across several stocks and at least a few industries. And the great news is you can apply the same technique with any amount.
Now, in this context, a purchase of CoreWeave could help you along the road to wealth and even eventually nudge your portfolio toward the value of $1 million.
