CoreWeave, an AI cloud provider backed by Nvidia, filed paperwork for an initial public offering on Monday — kicking off what investors hope will be a long-awaited wave of tech IPOs. 

But the New Jersey company’s S-1 filing revealed some significant flags in the business even as red hot demand for AI has sent its topline soaring by more than 700% in its most recent year. Just two customers accounted for 77% of that revenue, while losses have ballooned, CoreWeave stated in its prospectus, which also warned of “material weaknesses” in the company’s capacity to manage its internal financial reporting and IT systems.

How the market responds to the offering — CoreWeave said it will list shares on the Nasdaq under the “CRWV” ticker, but did not specify how much cash it plans to raise — will be a test of investors’ appetite for AI amid a years-long drought in IPOs. Reuters reported that CoreWeave was seeking to list shares at a valuation of $35 billion, citing anonymous sources.

“We are the AI Hyperscaler driving the AI revolution,” the company said in its S-1 filing, likening AI to a “new industrial revolution,” and boasting about its arsenal of 250,000 GPUs (the specialized and difficult-to-obtain chips used to train and run AI services) distributed across its 32 datacenters.

Nvidia, the $3 trillion chipmaker that is the leading provider of GPUs, owns a 1.21% stake in CoreWeave according to the filing. The company’s three co-founders — Michael Intrator, Brannin McBee, and Brian Venturo — own a combined 83% of the company’s voting power thanks to a special class of stock. A report in The Information on Monday noted that the trio of former commodity traders have each sold at least $150 million of their shares ahead of the offering.

This is the first tech IPO of 2025, and the first of Trump’s second term. Tech has been in a persistent IPO drought since the high-highs of 2021. Though there have been a few venture-backed winners who’ve braved the public markets—like Rubrik, Reddit, and ServiceTitan—the dearth of major exits has facilitated issues for venture capital firms, who have often turned to secondaries in hopes of seeing liquidity. Under Chair Lina Khan, the FTC was famously tough on possible M&A for Big Tech—but there’s hope that under the Trump administration, deals will rip and the IPO market will soar, though that has yet to be seen. 

The IPO drought has also coincided with the AI boom that was kicked off in November 2022, when OpenAI released ChatGPT. A number of companies, from startups to established tech companies, have bet big on AI since then, but few AI pure plays are publicly listed. 

From $16 million to $1.9 billion in three years

In 2024, CoreWeave’s revenue hit $1.92 billion, up more than 700% year-over year. It’s a wild world away from the end of 2022, when the company’s revenue was a mere $16 million. Net loss has been ballooning in recent years, clocking a roughly $863 million net loss for 2024, up from almost $594 million in 2023, though the company posted $324 million in operating income in 2024.

Topping CoreWeave's list of risk factors is the "substantial" portion of revenue tied to a limited number of customers, with Microsoft accounting for 62% of CoreWeave’s revenue in 2024, and another unspecified company accounting for another 15%. The company said its other customers include Nvidia (also an investor), Meta, IBM, Cohere, Mistral and that three of its top five contract customers have signed agreements for more capacity within 12 months of the initial purchase, equivalent to nearly $8 billion in additional committed spend. 

In an interview with Fortune last year, Intrator described CoreWeave's AI-focused cloud offering as a sleek Maserati car versus the minivans offered by his generalized cloud competitors. “You can get your kids to the soccer game, you can drag your college roommate’s couch across campus, you can do anything with it and it was incredibly effective,” he said. “We didn’t build that.” 

The company said in the filing that it has raised a total $12.9 billion in asset-backed debt through the end of 2024. The company, which began as a crypto mining firm called Atlantic Crypto in 2017, was last valued at $23 billion by private investors, according to Bloomberg. And the news outlet said that CoreWeave planned to raise roughly $4 billion in its IPO, citing anonymous sources.

CoreWeave, which hired Google cloud executive Nitin Agrawal as its CFO last year, said in its filing Monday that it was still working on getting the right people in place to solve some of the material weaknesses in its financial reporting and that “remediation efforts” are expected to go on until 2026. 

This story was originally featured on Fortune.com