AI Kept Spending. Inflation Gets the Next Vote.
GOOD MORNING, Wall Street faded Tuesday as hopes for a quick U.S.-Iran agreement weakened and oil closed at another one-week high. The S&P 500 and Nasdaq both finished lower ahead of July CPI, leaving markets caught between two forces: energy risk that can keep inflation sticky and an AI infrastructure cycle that still refuses to slow. After the bell, CoreWeave reported $2.58 billion of quarterly revenue, more than doubled from a year earlier, and disclosed roughly $104 billion of backlog. The demand is there. Now CPI decides how expensive the capital supporting it may become. MARKETS | TLDR
AI INFRASTRUCTURECoreWeave Has $104 Billion of Backlog — and an Even Bigger Capex BillCoreWeave reported second-quarter revenue of $2.575 billion, more than double the $1.212 billion generated a year earlier. Adjusted EBITDA reached $1.51 billion, and the company's contracted revenue backlog stood at roughly $104 billion as of June 30. That figure does not include more than $25 billion of additional customer commitments signed in early Q3. Shares rose sharply in after-hours trading as the company raised its annual spending and operating targets. The numbers reinforce one of the strongest arguments for the AI infrastructure trade: customers are still reserving compute years in advance. CoreWeave expanded active power capacity to 1.5 gigawatts and contracted power to roughly 3.7 gigawatts, showing that demand is no longer measured only in GPUs but in entire data-center campuses, megawatts and financing commitments. The company has already raised more than $10 billion through unsecured debt and convertible bonds this year. That financing profile is the caveat. CoreWeave posted a $626 million net loss in the quarter and paid $640 million of net interest expense. The business can have extraordinary demand and still be highly sensitive to the cost of capital because infrastructure must be financed before customer revenue arrives. That makes Wednesday's CPI report directly relevant to CoreWeave's economics: the AI buildout can keep accelerating while higher rates simultaneously make each new unit of capacity more expensive to fund. INFLATION TESTOil Put CPI Back at the Center of the TradeBrent crude settled at $88.91 Tuesday and WTI at $83.20, both at their highest closes since July 31. Prices had jumped about 5% Monday as hopes for a U.S.-Iran deal weakened, and they extended gains after Iran's Mohsen Rezaei said the Strait of Hormuz would remain closed until Washington changed its position. Roughly 20% of global oil supply passed through the strait before the war began. That matters because CPI arrives Wednesday with markets already debating whether the Fed needs another hike. Energy shocks do not immediately flow one-for-one into core inflation, but they raise gasoline, freight and production costs and can change household inflation expectations. A hotter-than-expected July print would make the oil move more consequential by reinforcing the idea that the Fed cannot look through the Middle East shock. The market has also become skeptical of peace headlines. Stocks opened higher Tuesday after reports suggested the U.S. and Iran might be nearing an arrangement, but those gains faded as conflicting statements emerged. That reaction is useful: investors are increasingly waiting for evidence of actual physical supply normalization rather than trading every diplomatic headline. Until Hormuz traffic improves materially, oil remains an inflation variable the Fed cannot fully ignore. HEADLINES
UPCOMING
DEEP INSIGTHSCoreWeave Q2 2026 ResultsThe primary release is worth reading because it shows both sides of the AI infrastructure boom in one place: revenue more than doubled and backlog reached $104 billion, but the company also reported a $626 million net loss and $640 million of quarterly interest expense. It is one of the clearest examples of how AI demand and financing intensity can rise together. Oil Prices Settle Higher as Iran Says Hormuz Will Stay ShutRead this for the distinction between diplomatic headlines and physical supply. Talks were still progressing, but Iran's public conditions and continued disruption through the Strait of Hormuz kept crude near a one-week high — the kind of persistent energy pressure that matters for inflation expectations and the Fed path. |