CoreWeave(NASDAQ:CRWV) It was one of the hottest tech stock stories of 2025. The stock’s price has more than doubled since its initial public offering (IPO) last March.
The company builds data centers specifically for artificial intelligence (AI) and sells the computing power obtained from them to AI companies such as OpenAI. Experts predict that money will continue to flow into AI data centers, with total spending potentially reaching trillions of dollars by 2030.
But investors looking to get better-than-market returns on the stock may want to forget about CoreWeave and look elsewhere. The stock faces some challenges that could affect its performance. So consider these two proven millionaire makers instead.
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Growth not a concern for CoreWeave as it continues to stock up Nvidia GPU chips for cutting-edge AI data centers. CoreWeave’s trailing 12-month revenue is now $4.3 billion. However, Wall Street analysts estimate that this amount will rise to $12 billion this year and $19.2 billion next year.
A stock looks like a turnstile, right? The problem is that CoreWeave needs to buy lots of GPU chips and build data centers to support this rapid growth, increasing its financial losses. It doesn’t have the money to pay for all that investment, and it burned through $8 billion in free cash flow last year alone.
CoreWeave has accumulated more than $18 billion in debt since July 2024, and its share count has risen more than 7.3% since its IPO. If the company continues to spend, borrow, and issue shares without generating meaningful cash flow in the near future, the stock will be less likely to perform well for investors.
Investors may want to focus on top AI stocks with strong supporting businesses that are currently generating significant profits to fund their AI investments.
To take Alphabet(NASDAQ:GOOG)(NASDAQ:GOOGL)for example, it has returned over 13,000% since 2004. Today Alphabet is a financial powerhouse. Its main businesses, Google, YouTube and Google Cloud, account for the lion’s share of the company’s $385 billion in annual revenue and $73 billion in free cash flow. These businesses help fund Alphabet’s investments in artificial intelligence.
Alphabet uses data from billions of people who use its various products and services to train its artificial intelligence models. It also leveraged its users to make the Gemini app a legitimate competitor to OpenAI’s ChatGPT. Additionally, AI is driving the growth of Google Cloud, as most AI applications currently rely on cloud computing. This is a win-win situation for Alphabet.
Despite Alphabet’s massive $4 trillion market cap, the stock still has a lot of upside over the long term. Analysts expect Alphabet to grow earnings at more than 16% annually over the next three to five years. new artificial intelligence partnership with Apple. As a result, there’s enough growth to justify buying shares today with a forward P/E ratio of 29.
Perhaps no technology company has been this successful Microsoft(NASDAQ:MSFT). The tech giant has returned more than 193,000% since 1987. Microsoft is involved in a wide variety of markets, from computer software to video games. In total, the company generates over $293 billion in annual revenue and over $78 billion in free cash flow. Existing businesses like Alphabet are also funding the AI budget.
Countless businesses and consumers rely on Microsoft’s software products, including Windows, Microsoft 365 (formerly Office 365), and Dynamics 365. Microsoft’s Azure nests sit just ahead of Alphabet as the world’s second-leading cloud services business. It is an ideal customer base to sell AI products. Microsoft also partners with and owns 27% of ChatGPT developer OpenAI.
Overall, Microsoft is showing steady growth across the company, with analysts calling for more than 16% annual earnings growth in the coming years. With its forward P/E ratio just above 30, I wouldn’t call Microsoft cheap. However, it can be said that there is a reasonable price for this growth. This stock won’t make you rich overnight, but you can’t go far wrong with a company like this that’s been winning for decades.
Before buying shares in CoreWeave, consider:
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Justin Pope He has positions at Alphabet and Microsoft. The Motley Fool has positions in and recommends Alphabet, Apple, Microsoft and Nvidia. The Motley Fool recommends the following options: long January 2026 $395 calls on Microsoft and short January 2026 $405 calls on Microsoft. The Motley Fool has a feature disclosure policy.
