CoreWeave scored significant wins in the first half, with revenue and stock performance soaring.
The company is a key partner of Nvidia and depends greatly on demand for the AI leader’s chips.
CoreWeave (NASDAQ: CRWV) delivered an exciting first half to investors. The company, known for its close relationship with artificial intelligence (AI) chip giant Nvidia (NASDAQ: NVDA), made its market debut, reported triple-digit quarterly revenue growth, and went on to gain 300%.
Investors are excited about CoreWeave as the company has seen soaring demand for its AI cloud services, and with the AI market potentially heading for $2 trillion in a few years, this momentum could continue. And just last week, this up-and-coming AI giant delivered even more fantastic news to shareholders. Let's check it out.
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First, though, let's catch up on the CoreWeave story so far. As mentioned, the company is linked to Nvidia, and this is in two ways: CoreWeave's main business is the leasing out of compute power in the form of Nvidia graphics processing units (GPUs), or the main chips fueling key AI tasks such as the training and inferencing of models. The company has a fleet of more than 250,000 GPUs operating in about 32 data centers, and customers can rent access to them by the hour or for a much longer period. So CoreWeave offers them a great deal of flexibility.
The second link to Nvidia is the fact that this AI powerhouse holds a 7% stake in CoreWeave. This support is a positive sign for CoreWeave and its investors because Nvidia, with its dominant position in AI, knows how to recognize potential winners. So, if Nvidia is investing in an AI company, other investors may want to give that particular company a closer look.
Now, let's consider the fantastic news CoreWeave just delivered to shareholders. The company said it became the first to make Nvidia's latest chip update -- Blackwell Ultra -- commercially available. This is in the form of the Nvidia GB300 NVL72 system built by Dell, a platform that CoreWeave says represents a "major leap" for AI reasoning and AI agent projects.
The GB300 NVL72 brings 1.5 times greater AI performance than the initial Blackwell chip -- GB200 -- that was launched in the fourth quarter of last year. And CoreWeave then was the first to make the Blackwell system available to customers too.
CoreWeave competes with other cloud providers such as Amazon's Amazon Web Services and Microsoft Azure, and those companies have both hefty resources and a broad customer base -- and they, too, offer Nvidia products and services. But, what could help CoreWeave stand out over time is this first access to Nvidia products and the fact that CoreWeave specializes in AI workloads. So, CoreWeave being first to launch Blackwell and Blackwell Ultra is key because it's establishing itself as the place for customers to go if they aim to gain immediate access to Nvidia's latest innovations.
This could help boost CoreWeave's already soaring demand. In the most recent quarter, revenue climbed more than 400% as customers rushed to the company for compute power. Considering CoreWeave now is launching Blackwell Ultra, it's reasonable to expect strong growth in the upcoming quarter too amid demand for this high-performance platform.
All of this is great news for early investors in this young AI stock. But what if you haven't yet invested in CoreWeave? Is it too late to get in on this soaring stock? This depends on your appetite for risk and your investment horizon.
Stocks never rise in a straight line without any sort of pause. So, it's possible that in the near- or mid-term, CoreWeave will see its shares stagnate or dip. And, though demand is high, it's important to remember that risk is present too: CoreWeave must invest heavily in GPUs in order to keep up with demand, and this may make it difficult to reach and secure profitability. This will be a point to watch in the upcoming quarters.
All of this means CoreWeave isn't the best fit for cautious investors or those who are uncomfortable with some ups and downs. But, aggressive investors with a long investing horizon may pick up a few shares of this highflyer and hold on -- if AI momentum continues at this pace and demand for Nvidia's GPUs remains strong, CoreWeave and its shareholders may be among the first to benefit.
Before you buy stock in CoreWeave, consider this:
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The demand for AI servers and edge devices like personal computers is growing at a strong pace, and Dell is on track to benefit.
A solid backlog in AI servers and a strong share of the PC market are going to be tailwinds for Dell.
Dell's valuation is too attractive to pass up right now, considering its impressive potential.
The demand for artificial intelligence (AI) infrastructure is booming as cloud service providers, hyperscalers, and countries across the world are spending aggressively on this technology to develop large language models (LLMs) and deploy them to increase productivity for themselves and their customers.
This explains the growth rate in sales of AI chips, servers, and edge devices such as smartphones and personal computers (PCs). Market researcher IDC says that the global sales for servers rose 134% year over year in the first quarter of the year to a record $95 billion, driven by investments in AI infrastructure. IDC now expects the server market to have 45% growth in 2025 to reach a record $366 billion in revenue.
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And shipments of AI equipped PCs are expected to jump by 165% in 2025, according to Gartner.
Let's take a closer look at one company that's a key player in both these markets and is trading at an extremely attractive valuation right now.
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Dell Technologies (NYSE: DELL) sells servers and PCs, besides other computer peripherals. The booming demand for AI servers has given one half of the company's business a big boost in recent quarters.
When Dell released its first-quarter fiscal 2026 results (for the three months ended May 2) on May 29, it reported a 12% year-over-year jump in revenue for its infrastructure solutions group to $10.3 billion. And the company booked $12 billion in orders for its AI servers in the quarter.
That's higher than Dell's AI server shipments last year, indicating that this business is set to gain more momentum. Management expects to ship $7 billion worth of AI servers in the current quarter, which would be around four times its fiscal first-quarter shipments. That seems achievable considering that the company's AI server backlog was $14.4 billion last quarter.
And its AI server backlog has the potential to grow further, based on management's comments on the latest earnings conference call.
So Dell's AI server revenue still has a lot of room to grow -- not surprising considering that the company is the leader in the global server market with an estimated share of more than 19%. The pace of new orders -- and the revenue pipeline that it points toward -- indicate that it should capture its share of the global end-market opportunity in servers.
Dell's client solutions group (CSG) -- which includes sales of laptops, desktops, and peripherals -- has started seeing an uptick in growth. Its CSG revenue was up 5% in the previous quarter to $12.5 billion. Almost 90% of that figure was from the commercial segment, which is benefiting from the upgrade to AI-enabled Windows 11 PCs.
The company is the third-largest player in the PC market with an estimated share of 16.3% in the first quarter of 2025. Its shipments increased by 2.1% year over year in the first quarter, and sales could gain momentum as the year progresses because management says there are indicators that its installed base is upgrading to new Windows 11 PCs, many of them with AI.
With shipments of AI-equipped PCs expected to increase 32% annually over the next decade, the company has terrific room for growth in this market. That has led management to raise sales estimates for the current and the next two fiscal years.
DELL Revenue Estimates for Current Fiscal Year data by YCharts.
Dell stock is trading at just 19 times trailing earnings, while the forward earnings multiple of 13 is even more attractive. Buying the stock at this valuation seems like a no-brainer considering the healthy prospects in the AI server and PC markets discussed above, which is expected to lead to similar earnings growth.
Consensus analyst estimates project a 15% increase in earnings this year to $9.39 per share, followed by double-digit growth over the next couple of years as well.
DELL EPS Estimates for Current Fiscal Year; data by YCharts.
And Dell could do even better than that given the rate of improvement in its AI server revenue pipeline. Meanwhile, the stock's price/earnings-to-growth ratio (PEG) of 0.95 (based on analysts' five-year estimates as per Yahoo! Finance) suggests that Dell is undervalued considering its potential long-term bottom-line growth.
So, investors looking for an incredibly cheap AI stock with the potential for healthy upside in the long run should consider Dell before it flies higher following its 33% gains in the past three months.
Before you buy stock in Dell Technologies, consider this:
The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Dell Technologies wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years.
Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you’d have $692,914!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $963,866!*
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Harsh Chauhan has no position in any of the stocks mentioned. The Motley Fool recommends Gartner. The Motley Fool has a disclosure policy.
Nvidia and other large tech companies are building AI factories, creating unprecedented demand.
Dell Technologies' AI server sales skyrocketed last year.
Dell's AI orders continue to flow in, creating a significant -- and growing -- backlog.
There will be many winners as infrastructure is built to support the huge and increasing computing power needed for artificial intelligence (AI) applications. Nvidia continues to pave the way and has already been a huge beneficiary thanks to its leading advanced chips, software, and engagement with developers.
Nvidia's revenue has soared from what was then a record $61 billion in fiscal 2024 to more than $130 billion in its fiscal year 2025, ended Jan. 26. That growth continues as sales in the first half of fiscal 2026 are expected to be approximately $90 billion. It's all about the company's data center segment, as companies -- as well as sovereign nations -- quickly invest in infrastructure to expand AI capabilities.
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That infrastructure includes servers and cooling systems that are provided by Dell Technologies (NYSE: DELL). The company's revenue has also been soaring, and it is well positioned to ride AI's "golden wave" along with Nvidia.
Image source: Getty Images.
Dell isn't a pure-play AI stock, but it has already seen benefits from the AI revolution. Revenue hasn't soared quite as much as it has for Nvidia, but Dell's Infrastructure Solutions Group saw sales hit a record $43.6 billion in fiscal 2025, up 29% year over year. Zoom in specifically to its AI server business, though, and the growth is more impressive. Server shipments generated nearly $10 billion, up over sixfold from $1.5 billion in fiscal year 2024.
Demand continued to grow in the company's fiscal 2026 first quarter, and the period ended on May 2 with a $14.4 billion AI backlog. Chief operating officer Jeff Clarke called the demand unprecedented, adding, "We generated $12.1 billion in AI orders this quarter alone, surpassing the entirety of shipments in all of [fiscal 2025]."
That's all because of the huge data centers and AI training factories being built by large growth companies as well as sovereign governments -- all of it supported by Nvidia and its powerful products. Meta Platforms, Amazon, Alphabet, and Microsoft collectively have plans to spend as much as $320 billion this year investing to expand AI capabilities.
Another group of tech companies is partnering with ChatGPT creator OpenAI for the Stargate Project, with another $500 billion in AI infrastructure investments planned over the next several years.
OpenAI has also started a program intending to help regions outside the U.S. launch large AI projects. Dell servers will likely be part of most of this development. It's why the stock has quickly rebounded from its April lows.
That growth is driving investors to Dell stock. But there are other reasons to own it, too. The company's Client Solutions personal computer segment is also integrating AI for commercial and retail clients. That segment provides a stable cash flow base and it generated more revenue than the Infrastructure Solutions group last year.
Management is returning some of that cash flow to shareholders. It increased its annual dividend by 18% for the current fiscal year, and its board of directors approved a $10 billion increase in its share repurchase authorization.
The company says it is committed to returning at least 80% of its adjusted free cash flow to shareholders. It also plans to raise its dividend at least 10% annually through fiscal year 2028. That shareholder-friendly approach should make investors feel good.
Yet surging demand and a large and growing backlog for its AI servers are what really make it a good time to buy Dell stock. It has more runway ahead to ride the golden wave of AI along with Nvidia.
Before you buy stock in Dell Technologies, consider this:
The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Dell Technologies wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years.
Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you’d have $697,627!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $939,655!*
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John Mackey, former CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool's board of directors. Suzanne Frey, an executive at Alphabet, is a member of The Motley Fool's board of directors. Randi Zuckerberg, a former director of market development and spokeswoman for Facebook and sister to Meta Platforms CEO Mark Zuckerberg, is a member of The Motley Fool's board of directors. Howard Smith has positions in Alphabet, Amazon, Dell Technologies, Microsoft, and Nvidia. The Motley Fool has positions in and recommends Alphabet, Amazon, Meta Platforms, 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 disclosure policy.
The tech sector has been a market-beating beast in recent years. Tech-heavy exchange-traded funds (ETFs) like the Vanguard Information Technology ETF (NYSEMKT: VGT) and the Invesco QQQ Trust (NASDAQ: QQQ) have delivered annual returns of more than 21% over the last three years. Broad market trackers like the Vanguard S&P 500 ETF (NYSEMKT: VOO) only gained 15.5% per year over the same period. Yes, that's a fantastic return from a historic perspective, but the tech sector offered even stronger gains.
Image source: Getty Images.
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The technology boom has been driven by artificial intelligence (AI) news, starting with the public release of ChatGPT in November 2022. Many leaders in the AI market have soared sky-high, adding fuel to the tech sector's market performance fires, but also making those market darlings a bit expensive.
Fortunately, the market-moving forces left a few top-notch companies behind. I still see several tech stocks with a combination of bright business prospects and modest stock prices. Let's check out a couple of underappreciated bargain-bin tech stocks. This dynamic duo looks ready for a fresh bull run.
Digital advertising has been a troubled sector since the first signs of an inflation crisis in 2021. Paris-based commerce media specialist Criteo (NASDAQ: CRTO) provides purchase-inspiring ad services to global brands. This focus placed the Parisian company in the epicenter of the inflation-based slowdown -- why invest in lavish marketing campaigns when consumers are pinching pennies and tightening belts?
Criteo's revenues have indeed slumped since then, and so has the stock price. You know what's surging in recent quarters, though? That would be Criteo's free cash flows:
CRTO Free Cash Flow data by YCharts
The cash profits took a temporary dip, but came back stronger, with trailing cash flows reaching an all-time high in May's Q1 2025 report. But Criteo's stock price is down more than 30% in the last quarter, and the shares are trading at the bargain-bin valuation of 11.3 times earnings and 6.6 times free cash flow.
I'm not saying the digital ad market is roaring back to life in the spring of 2025. The political climate may result in another inflation spike, and advertisers are already reducing their ad-spot spending right now. Hence, Criteo's undervalued stock may see more volatility and weakness in the coming months. However, I think the market makers have underestimated Criteo's ability to turn cash profits in a soft market.
The Criteo shares you buy at a discount in this downswing should return to more reasonable valuation ratios someday. At the same time, the company's robust cash generation makes it less vulnerable to short-term financial challenges. You can buy Criteo stock with confidence while it's cheap. This one is poised for great long-term returns, and patience is the greatest Wall Street virtue of them all.
My next recommendation is more of a household name. Hewlett Packard Enterprise (NYSE: HPE) has been around (in some form) since 1939. As the data center and cloud computing operator of the old HP business, HP Enterprise (aka HPE) plays a serious part in the AI boom.
Indeed, seven out of the 10 most powerful supercomputers today were built by HP Enterprise. Only Chinese rival Lenovo has more systems in the top 500 than HP Enterprise, and nobody can match the total number-crunching performance of this company's ultra-powerful systems. Any company or organization that needs a top-performance system for their AI training and operations is likely to check out HP Enterprise's catalog first.
So I'm talking about an AI powerhouse here. Yet, the stock price has dropped 16% lower year to date while smaller system builders Super Micro Computers (NASDAQ: SMCI) and Dell (NYSE: DELL) are up by 41% and down by just 1%, respectively. Trading at 8.9 times earnings and 14.3 times free cash flow, HP Enterprise looks downright cheap next to these challengers.
HP Enterprise's stock could double or triple in price and still be affordable next to Supermicro or Dell. This could be a great value play on the hardware side of the AI boom.
Before you buy stock in Criteo, consider this:
The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Criteo wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years.
Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you’d have $653,389!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $830,492!*
Now, it’s worth noting Stock Advisor’s total average return is 982% — a market-crushing outperformance compared to 171% for the S&P 500. Don’t miss out on the latest top 10 list, available when you join Stock Advisor.
*Stock Advisor returns as of May 19, 2025
Anders Bylund has positions in Criteo, Vanguard Information Technology ETF, and Vanguard S&P 500 ETF. The Motley Fool has positions in and recommends Vanguard S&P 500 ETF. The Motley Fool recommends Criteo. The Motley Fool has a disclosure policy.
A lawyer representing MyPillow and its CEO Mike Lindell in a defamation case admitted using artificial intelligence in a brief that has nearly 30 defective citations, including misquotes and citations to fictional cases, a federal judge said.
"[T]he Court identified nearly thirty defective citations in the Opposition. These defects include but are not limited to misquotes of cited cases; misrepresentations of principles of law associated with cited cases, including discussions of legal principles that simply do not appear within such decisions; misstatements regarding whether case law originated from a binding authority such as the United States Court of Appeals for the Tenth Circuit; misattributions of case law to this District; and most egregiously, citation of cases that do not exist," US District Judge Nina Wang wrote in an order to show cause Wednesday.
Wang ordered attorneys Christopher Kachouroff and Jennifer DeMaster to show cause as to why the court should not sanction the defendants, law firm, and individual attorneys. Kachouroff and DeMaster also have to explain why they should not be referred to disciplinary proceedings for violations of the rules of professional conduct.
© Getty Images | Alex Wong
Despite the extreme stock market volatility at the start of 2025, the artificial intelligence (AI) revolution is moving full steam ahead. Advances in machine learning and automation technology are rapidly reshaping the global economy, ushering in a new era of business productivity and human creativity.
At the core of this transformation are high-performance data centers, which play a critical role in the AI ecosystem. Two leading companies in this space are Super Micro Computer (NASDAQ: SMCI) and Dell Technologies (NYSE: DELL), which supply the essential server equipment and storage hardware to run AI workloads.
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Let's discuss whether Supermicro (as it is commonly known) or Dell Technologies is the better AI stock to buy right now.
Image source: Getty Images.
Supermicro presents a remarkable growth story as an early winner in the AI boom. Even with the stock down 66% from its 52-week high at the time of writing, longtime shareholders have still enjoyed a 1,470% return over the past five years.
The company capitalizes on the demand for specialized rack-scale computer systems, which integrate power, storage, cooling, and software components to support graphics processing unit (GPU)-based AI chips from Nvidia and Advanced Micro Devices. Its technical leadership in next-generation direct-liquid cooling (DLC) technology is a key advantage, offering significant energy-efficiency gains for power-intensive data centers. Additionally, the company's U.S. manufacturing presence has become increasingly important amid trade tensions as businesses seek to secure their supply chains.
Supermicro expects revenue to reach $23.5 billion to $25.0 billion in fiscal 2025, a 62% year-over-year increase. Looking ahead, the company sees a path to $40 billion in revenue by next year, driven by growing market adoption of its DLC technology and expanding production capacity. This momentum is accompanied by improving profitability, with Wall Street analysts predicting a 17% increase in adjusted earnings per share (EPS) this year to $2.59.
On the other hand, Supermicro's success has not been without challenges. In 2024, the company faced a headline-making accounting investigation by the U.S. Department of Justice (DOJ) while its auditor resigned due to governance concerns. Favorably, the company has since cleared up some of those issues, releasing an audited 2024 annual report, while an independent special committee cleared it of misconduct allegations. Uncertainties remain, including possible DOJ sanctions, yet the attraction of Supermicro now as an investment is in this comeback story.
Investors who believe Supermicro's growth trajectory is back on track have plenty of reasons to buy shares of this AI leader.
Dell Technologies' strength lies in its diversification. Generating $96 billion in revenue in fiscal 2025 (ended Jan. 31), the company is 4 times larger than Supermicro. It benefits from a broad product portfolio across enterprise-grade solutions and a consumer devices franchise.
This year, its AI-optimized server systems powering data centers have driven record earnings. For the last reported fiscal 2025, revenue increased 8% year over year, with adjusted EPS rising 10% to $8.14. Notably, the AI servers and networking segment revenue grew 54% annually, nearly matching Supermicro's momentum.
While sluggish personal computer demand has weighed on Dell's firmwide results, this segment could have a silver lining. Dell's strategic emphasis on AI-powered PCs for businesses and consumers positions it to leverage an anticipated industry-wide replacement cycle for AI-ready devices into the next decade.
Perhaps the strongest case for Dell as the better AI stock over Supermicro is its valuation. Shares trade at a forward price-to-earnings (P/E) ratio of 9.2, a steep discount to Supermicro's earnings multiple of 14.3. One interpretation is that Dell stock is undervalued, with shareholders also receiving a 2.1% dividend yield supported by its high-quality free cash flow.
Data by YCharts. PE Ratio = price-to-earnings ratio.
I'll give Supermicro the edge as the better AI stock based on its more specialized focus on AI infrastructure hardware and leadership in liquid cooling solutions. While the stock is riskier than Dell's, its stronger growth outlook may offer more upside potential if it can overcome regulatory uncertainties. If investors recognize that the delicate macroeconomic environment is a risk to consider, Supermicro stock is a great option for investors to capture tech and AI exposure in a diversified portfolio.
Before you buy stock in Super Micro Computer, consider this:
The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Super Micro Computer wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years.
Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you’d have $495,226!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $679,900!*
Now, it’s worth noting Stock Advisor’s total average return is 796% — a market-crushing outperformance compared to 155% for the S&P 500. Don’t miss out on the latest top 10 list, available when you join Stock Advisor.
*Stock Advisor returns as of April 10, 2025
Dan Victor has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Advanced Micro Devices and Nvidia. The Motley Fool has a disclosure policy.
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