The canary in the coal mine

CoreWeave just pulled off the first big initial public offering this year — and the results were far from heartening.

The company, which rents computing power to the artificial intelligence industry, shrank its I.P.O. far below initial expectations before Friday’s anticipated trading debut. That’s even after Nvidia, which owns a stake in the company, committed to buy more shares as part of the offering.

The big question is whether CoreWeave’s troubles speak to only one company — or to broader economic conditions, which would portend trouble for the embattled I.P.O. landscape as a whole.

How far short did CoreWeave’s I.P.O. fall? The company priced its offering at $40 a share, compared with an initial range of $47 to $55. It also sold 37.5 million shares, about 23 percent less than expected. Overall, it raised $1.5 billion at a roughly $23 billion valuation, down from its initial hopes of $4 billion at a $35 billion valuation.

The company was battling tough I.P.O. conditions. The stock market has been weighed down by uncertainty around President Trump’s tariffs and inflation.

“It has been a brutal time for markets in general,” Samuel Kerr, the head equity capital market analyst at the financial insights firm Mergermarket, told The Times. “It shows you that there is very little appetite to put forward this kind of risk transaction at the moment.”

CoreWeave was seen as a vanguard for A.I. initial offerings. It was founded as a cryptocurrency mining start-up in 2017, relying on Nvidia graphics processors that can analyze enormous amounts of data.

When crypto prices crashed in 2019, CoreWeave rushed to stockpile the powerful chips, buying them from distressed crypto companies. After OpenAI released ChatGPT in 2022, the company pivoted to renting its chips via the cloud to A.I. developers.

CoreWeave has raised $2.3 billion in venture capital funding and last year was valued at $19 billion in private markets. Its three founders, Michael Intrator, Brian Venturo and Brannin McBee, who still run the company, own around 30 percent of it. A special class of shares gives them around 80 percent of the voting power.

But its financials in some ways underscore the challenges facing the A.I. industry. While CoreWeave’s revenue jumped to $1.9 billion last year, up from $229 million a year earlier, it has yet to turn a profit — and spent nearly $1 billion last year to finance its debt.

While the so-called Magnificent Seven of tech giants has enjoyed soaring stock valuations over the past few years, driven by Wall Street enthusiasm for A.I., investors have grown warier about the amount companies are spending on the technology. Shares in Nvidia, the core member of that group, are down 7 percent alone since Wednesday.

Then again, how much of a litmus test is CoreWeave’s I.P.O.? While the company is the first major A.I. business to go public, it doesn’t represent the true titans of the field, makers of large language models like OpenAI and Anthropic.

CoreWeave also “has a lot of idiosyncrasies that make it a difficult I.P.O. candidate,” Kerr told The Times, including the huge amount of debt it took on to build new data centers and its unusual background as a cryptocurrency mining firm. (It also depends heavily on a small group of customers, including Microsoft, Meta and OpenAI.)

Still, at a time companies are already skittish about going public amid market volatility, the downbeat offering doesn’t give much assurance.

HERE’S WHAT’S HAPPENING

Another giant law firm seeks to cut a deal with President Trump. Skadden, Arps, Slate, Meagher & Flom has held discussions with Trump advisers over how to avert a potentially devastating executive order targeting the firm after the president imposed similar moves on some of its rivals, The Times reports. That group now includes WilmerHale, a major Washington firm that once employed as a partner Robert Mueller III, who served as special counsel on the Trump-Russia investigation.

A federal judge orders some Trump officials to preserve messages in the Signal leak. Judge James Boasberg, who has drawn impeachment threats over his efforts to check parts of the Trump agenda, ordered several participants in the group text about attacks on Yemen not to delete their texts. The move drew criticism from Republicans including Attorney General Pam Bondi, who suggested that the Justice Department wouldn’t investigate the episode. Still, some Republican lawmakers have openly criticized Defense Secretary Pete Hegseth for disclosing operational details in a nonsecure channel.

Trump warns carmakers not to raise prices in response to auto tariffs. The president’s demand, delivered to C.E.O.s this month, leaves manufacturers in a bind, according to The Wall Street Journal: Absorb higher costs and accept leaner profits, or potentially face the wrath of the White House. It’s a sign of the tough choices being imposed on carmakers, especially as fulfilling Trump’s goal of increasing domestic auto manufacturing would take years.

Inflation watch

The American consumer is looking shakier by the day. The latest data point: Shares in Lululemon on Friday sank sharply in premarket trading after the apparel maker, whose sales zoomed during the coronavirus pandemic, reported a downbeat outlook for this year.

It adds to a list of consumer brands and retailers who have warned that customers are spending less. Calvin McDonald, Lululemon’s C.E.O., cited “considerable uncertainty driven by macro and geopolitical circumstances.”

That dismal take puts additional focus on the Personal Consumption Expenditures report, the Fed’s favored inflation measure. It’s set for release at 8:30 a.m. Eastern.

What to know about the report: While the full effects of Trump’s tariffs are expected to show up in the coming months, economists will be closely watching for signs of whether businesses are adjusting prices in anticipation.

Two big questions are underlying the data. Could a hot reading on Friday have any implications on the Trump agenda, especially as economists warn that his immigration crackdown and the trade war could accelerate inflation? On the flip side, would a tame number persuade the Fed to resume cutting rates more quickly?

Here’s what to watch for on Friday:

• Core inflation for February, which strips out volatile food and fuel prices, most likely ticked up slightly from the January reading, to 2.7 percent, according to estimates from FactSet. That would be above the Fed’s 2 percent target.

• The month-on-month figure is expected to show a 0.3 percent rise, though economists at Vanguard and Goldman Sachs see it going a touch higher.

• The culprits are rising prices on clothing, furniture and household goods, Vanguard estimates.

• The good news: Shelter prices, last year’s bugaboo, appear to be heading down, economists note.

Consumer sentiment data will also be on the radar. The revised March reading from the University of Michigan is set for release on Friday, offering another gauge on households’ mood. A similar survey by The Conference Board on Tuesday showed that consumer confidence had plunged to a 12-year low.

Among Americans’ chief concerns: inflation and tariffs.

Downturn and trade war worries are weighing on markets. The S&P 500 is on track for its first losing quarter since 2023.

One automaker that’s not sweating a trade war

President Trump’s auto tariffs may not have come as a complete surprise, but they still sent much of the industry and international leaders reeling.

Trump’s vow to hit carmakers with levies on imported cars and auto parts prompted especially loud protests from leaders in France and Germany, who urged the European Union to respond. But one European manufacturer doesn’t seem to be sweating the move: Ferrari.

Ferrari announced on Thursday that it would raise prices by as much as 10 percent for most models, which would mean an additional 40 grand for a $400,000 Purosangue, Italian for “thoroughbred.” It explicitly cited “the introduction of import tariffs on E.U. cars into the U.S.A.”

Shares in the Italian luxury carmaker were up nearly 3 percent on Friday — after two analyst upgrades.

Why Trump’s tariffs are unlikely to dent Ferrari: “We are hard-pressed to think of any customer cohort in the U.S. that is better placed than Ferrari’s to absorb higher prices,” Stephen Reitman, an auto analyst at Bernstein, wrote in a research note on Thursday.

The waiting list for a new Ferrari is already long, as much as three years for some Purosangue models.

Another data point: “The majority of Ferraris sold in the U.S. go to owners who already own more than one Ferrari (the global average is 49 percent),” Reitman wrote.

He added that “any increase in new prices will be somewhat cushioned by the knowledge that the customer’s other Ferraris in their garage have seen their values rise as well.”

And there’s a potential Trump tax break. “If the president makes good on his promise of tax cuts for higher earners and allowing the deduction of car interest payments from income tax,” Reitman wrote, “that certainly does not hurt Ferrari customers.”

The rest of the industry, and its customers, may not fare so well. Arthur Laffer, the influential conservative economist whom Trump awarded the Presidential Medal of Freedom in 2019, wrote in a recent analysis that the tariff policy needed serious work to avoid battering the auto sector, according to The Associated Press.

Especially important, according to Laffer, is keeping a temporary exemption for cars and parts from that fall under the current the United States-Mexico-Canada Agreement. “Without this exemption, the proposed tariff risks causing irreparable damage to the industry, contradicting the administration’s goals of strengthening U.S. manufacturing and economic stability,” he wrote.

THE SPEED READ

Deals

• Omaha Productions, Peyton Manning’s media company, raised money from a new venture run by Patrick Whitesell, the former executive chair of Endeavor, and the investment firm Silver Lake. (Variety)

• Elliott Investment Management, the big activist investor, criticized the C.E.O. of Phillips 66 for what it said was a bearish take on the oil refiner’s prospects. (Semafor)

Politics, policy and regulation

• “The DOGE Playbook Targeting Federal Agencies” (NYT)

• The Environmental Protection Agency said that power plants and others can seek exemptions to clean-air restrictions — via email. (NYT)

• Trevor Milton, the founder of the electric vehicle maker Nikola who had been convicted of securities fraud, said President Trump pardoned him; the White House hasn’t confirmed his account. (FT)

Best of the rest

We’d like your feedback! Please email thoughts and suggestions to dealbook@nytimes.com.