Cathie Wood Increases Stake in CoreWeave, Reduces Holdings in Palantir

Key Highlights

Ark Invest spent $16 million to buy into CoreWeave as its stock price fell by 7%, while reducing its holdings in Palantir worth $10 million; Palantir currently has a price-to-earnings ratio as high as 244 times. The resignation of NVIDIA's CEO and weak performance guidance from competitor Neocloud triggered a pullback in CoreWeave's stock price, leading the market to question NVIDIA's stability regarding its $2 billion partnership project with CoreWeave. CoreWeave holds $132 billion in order reserves, but this does not offset its high debt, heavy interest expenses, and customer concentration risk, with its largest client contributing 67% of its revenue.

On Thursday, November 12, 2026, Ark Invest purchased 283,022 shares of CoreWeave (CRWV) for approximately $16 million; the stock fell 6.86% on the day, closing at $56.60. From two of its funds, ARK sold 58,339 shares of Palantir (PLTR), valued at about $10 million. Palantir experienced minimal fluctuations that day, dropping 0.48% to close at $171.58.

Ark did not disclose the reasons for the adjustments, but Cathie Wood's firm chose to increase its stake in this AI infrastructure company, which relies on debt expansion, while reducing its holdings in this high-valuation AI software leader.

Details of the Transactions

Both transactions were executed through the flagship Ark Innovation ETF (ARKK) and another internet-themed fund. The ARKK holdings report from November 12 shows that the fund holds approximately 2,431,528 shares of CoreWeave, accounting for 2.37% of the fund's net asset value; it holds about 948,590 shares of Palantir, making up 2.63%.

On the same day, ARK also purchased about $8.9 million in Twist Bioscience (TWST) while slightly selling off other holdings. This indicates that the reduction in Palantir is part of a broader reallocation strategy. Palantir remains one of ARKK's major holdings, and this reduction is not a complete exit.

The decline in CoreWeave occurred after a significant earnings report. CoreWeave released its Q3 report on November 10, closing at $48.73; on November 11, it surged 24.71% to $60.77; on November 12, it dipped to a low of $50.17, ultimately closing at $56.60. This closing price is still above pre-earnings levels, but as of November 12, the stock has accumulated a decline of 27.26% this month.

The market has identified two main reasons for the decline: first, competitor AI cloud provider Neocloud provided weak performance guidance; second, following Jensen Huang's resignation as NVIDIA's CEO, the market began to worry about NVIDIA's continued support for CoreWeave. NVIDIA had previously invested $2 billion in CoreWeave in January 2026. CoreWeave's CEO stated on November 11 (before the news of Huang's departure) that there was no reason to believe the partnership had changed.

Comparison of the Two Companies' Fundamentals

CoreWeave's current valuation is approximately $25.97 billion. Q3 revenue grew by 168% year-over-year to $3.66 billion, with order reserves of $132.5 billion; the company plans to invest $37-39 billion in capital expenditures, with a Q3 loss of $709 million, of which net interest expenses reached $846 million. The order reserves secure future revenue but do not resolve the financing costs associated with large investments, nor do they alleviate customer concentration risk. In 2025, its largest single customer contributed about 67% of its revenue.

Palantir's valuation is approximately $395.78 billion, with a debt-to-equity ratio of only 0.03 and a net profit margin of 36.3%; Q3 revenue grew by 95.9% year-over-year to $2.313 billion. The cost of its strong fundamentals is a staggering price-to-earnings ratio of 244 times.

On November 12, Barclays lowered CoreWeave's target price from $105 to $85, while Argus reduced it from $150 to $100; both institutions' revised target prices remain above the current price. Notably, this performance was initially above expectations, yet analysts promptly lowered target prices, reflecting rising market concerns about its financing risks.

Risks CoreWeave Investors Need to Weigh

For investors nearing retirement, CoreWeave poses significant risks: the company's debt is substantial, and it has an ATM issuance plan (which allows for the issuance of up to 35 million shares in the secondary market as needed), presenting a risk of equity dilution; its core supplier NVIDIA has just undergone a management change. In the ARKK portfolio, CoreWeave accounts for 2.37%; for a high-risk fund, this position size is still within a controllable range even if the investment fails.

Although ARK chose to reduce its holdings in Palantir, it has a stronger financial profile. The company expects adjusted free cash flow to reach $4.8-5 billion in 2026. As of November 12, the stock has accumulated a decline of 17.77%, somewhat absorbing the valuation of growth stocks.

Looking ahead, attention should be paid to NVIDIA's earnings report on November 17. If CoreWeave's stock falls below $48.73 after the earnings rally, it would indicate a complete reversal of the gains brought by the earnings report, further deepening market concerns about its financing pressures; if it stabilizes above $60.77, then the decline on November 12 is likely just a short-term disturbance.