US IPO Weekly Winners & Losers

Investors are approaching every IPO with caution, even pure-play AI companies.

Cloud computing firm CoreWeave (Nasdaq: CRWV) raised $1.5 billion this week, well below the already slimmer-than-expected target of $2.5 billion. The company sold fewer shares and priced $7 below the range. The largest tech IPO since 2023 ended its first day flat.

This was the first major IPO to test the market since the recent sell-off, and it didn’t deliver. A mountain of debt, an unclear moat, and a raft of related-party transactions weighed heavily on the deal. It’s the top AI hyperscaler now, but no one knows what the business will look like in five years, in an industry that reinvents itself every few months. Remember that top customer Microsoft is also a top competitor.

Rumors of canceled service agreements and technical loan defaults added more “hair” to an already hairy deal.

CoreWeave’s weak debut won’t necessarily affect names already in the pipeline, such as Klarna, StubHub, and as of this week, eToro. It may delay new filings, though. The IPO market still needs a win to fully reopen.

Can the banks bring us a nice Rule-of-40 software company?

Next up: Conservative media company Newsmax Media (NYSE: NMAX) begins trading on Monday after raising $75 million in a Reg A+ IPO. After that, SmartStop Self Storage REIT (NYSE: SMA) is listing mid-week in the year’s 4th-largest IPO to date.

Tariffs and inflation worries wiped out last week’s gains. The IPO Index slid -3.6%, compared to -1.5% for the S&P 500. Pork producer Smithfield Foods led the winners, up +6.2% following its addition to the Russell 1000 Index. Chinese autonomous driving play Pony AI plunged -29.4% on disappointing earnings.