CoreWeave Earnings Surprise Warms AI Infrastructure Stocks

Chipmakers Including Samsung, SK Hynix Gain

CoreWeave Raises Operating Profit Outlook 26%

Higher GPU Rental Prices Boost Profitability

Brokerages Say Fears of AI Overinvestment Are Easing

Jusung Engineering Up 17%; Simtech Holdings Jumps 29%

South Korea’s Kospi rose for a second straight day on Nov. 11, reclaiming the 5,300 level despite renewed concern over additional U.S. rate hikes. Buying flooded into AI infrastructure shares, including semiconductors and chip materials, parts and equipment makers, after neo-cloud company CoreWeave — seen as the epicenter of worries over slowing AI investment and funding pressure — reported results that topped market expectations. Brokerages said the market remains cautious on high interest rates, but doubts over the durability of AI spending are beginning to fade.

Kosdaq Sidecar Triggered for Second Straight Day

The Kospi closed up 2.6% at 5,375.36 on Nov. 11. Stocks opened lower after overnight data showed the U.S. consumer price index for October came in above forecasts, stoking concern that the Federal Reserve could deliver a 0.5-percentage-point rate increase in December. The market quickly reversed higher. Foreign investors drove the gains, buying a net 655.4 billion won ($474 million) of shares. After selling nearly 19 trillion won ($13.7 billion) of stocks on the main board in October alone, overseas investors turned net buyers the previous day for the first time in eight sessions and extended that streak for a second day. The Kosdaq also jumped 5.6% to 705.10, recovering the 700 mark for the first time in five sessions. A buy-side sidecar was triggered in morning trading for a second consecutive day.

Semiconductors and other AI infrastructure and hardware names led the rally. SK Hynix climbed 5.4% and Samsung Electronics gained 3.6%. Semiconductor materials, parts and equipment makers posted double-digit gains, including Jusung Engineering, up 17.1%, Korea Circuit, up 25.6%, and Simtech Holdings, up 28.9%. South Korean data-center plays also finished higher. NHN, which has already surged 42% this month, added nearly 4% on the day. Elice rose 3.1%, Naver gained 0.7%, and SK Telecom advanced 1.5%.

CoreWeave Third-Quarter Revenue Surges 168%

The catalyst for the market turnaround was CoreWeave, which reported earnings on Nov. 11. The company said third-quarter revenue rose 168% from a year earlier to $3.661 billion, topping the market estimate of $3.56 billion. Remaining performance obligations climbed 27% over three months to $132.5 billion. CoreWeave also raised its full-year revenue forecast to a midpoint of $13.15 billion from $12.8 billion.

Adjusted operating margin reached 10%, hitting double digits a quarter earlier than the company had planned. AI computing demand continued to rise even after CoreWeave increased graphics processing unit rental prices twice, in July and September, to reflect higher costs. Management said third-quarter GPU contracts were renewed at prices 30% to 50% above the previous quarter. It added that most of its capacity through 2027 was effectively sold out. CoreWeave also highlighted strong AI demand and raised its full-year adjusted operating profit outlook by 26%.

Still, high interest costs and negative free cash flow of $7.5 billion remained a burden. Goldman Sachs said the cash-flow deficit was smaller than the market forecast of negative $9.1 billion and called it the first step toward a rerating of the shares. CoreWeave said it would avoid issuing high-interest unsecured bonds through the end of next year and would fund capital spending through delayed-draw term loans and customer prepayments. JPMorgan maintained its buy rating, saying earlier-than-expected margin improvement and clearer funding visibility had resolved the market’s key debate.

CoreWeave also addressed recent concerns over U.S. Democratic Party data-center regulations, which had helped drive the market’s recent decline. The company said deliveries scheduled for 2027, for which permits have already been secured, carry no regulatory risk. Ko Young-min, an analyst at Korea Investment & Securities, said the results directly addressed market concerns over the durability of AI investment and the risk of tighter data-center regulation under a Democratic blue wave. At a minimum, the odds of AI investment slowing because of funding constraints or regulation now appear limited. He added that financing concerns are likely to persist, but this cycle’s “new normal” may be continued investment growth despite what is visible on the surface. His view that November would mark the start of a turnaround remains unchanged.

Bin Nan-sae and Kang Jin-gyu, Hankyung.com reporters binthere@hankyung.com