By Britney Nguyen
Despite upbeat revenue figures, Cerebras's stock was falling in after-hours trading
Cerebras posted its first-ever earnings report Tuesday.
Cerebras Systems' stock bucked the chip-sector selloff in Tuesday's regular session - but it was getting punished in after-hours trading, despite better-than-expected results and guidance in the AI-chip maker's first earnings report as a public company.
Cerebras (CBRS), which held its initial public offering in May, posted first-quarter core revenue of $191.3 million, up 92% from a year ago and ahead of the FactSet analyst consensus for $181.2 million. The company uses &#34;core financial results,&#34; which it says &#34;exclude the impact of amortization of customer warrants, data-center pass-through revenues and costs,&#34; among other items.
Cerebras CEO Andrew Feldman noted in a statement that the company has seen &#34;significant momentum with pioneering customers&#34; that include OpenAI and Amazon Web Services (AMZN), thanks to its technology that &#34;delivers the fastest AI in the world.&#34;
The chip maker - which focuses on inference, or the process of running artificial-intelligence models - is now serving OpenAI's GPT-5.4 that was released in early March, Feldman told MarketWatch.
Cerebras uses an entire wafer as one chip through a technique called wafer-scale integration, instead of the usual process which splits a wafer into several individual die. The chip maker said its wafer-scale engine is 58 times larger than Nvidia's (NVDA) B200 chip and includes on-chip static random-access memory, which is faster than the dynamic random-access memory used by other companies.
Cerebras announced a multiyear agreement with OpenAI in January for the ChatGPT maker to deploy 750 megawatts of AI inference compute capacity. The deal is valued at more than $20 billion, according to the chip company. OpenAI also has a warrant to purchase up to 33.4 million shares of Cerebras's common stock.
The company also has an agreement with AWS to deploy its wafer-sized chips in the hyperscaler's data centers.
Cerebras reported a core gross margin of 47% and a core operating loss of $3.5 million for the first quarter. The company's core net loss was $2.5 million.
Management's guidance for second-quarter core revenue calls for $194 million, above the $178 million consensus analyst view.
Still, Cerebras's stock fell more than 9% in after-hours trading following the report.
How quickly the chip maker can deploy compute capacity will be &#34;the key driver of revenue and gross-margin upside,&#34; Morgan Stanley analyst Joseph Moore said in a report ahead of the earnings release - noting expectations for Cerebras to bring 250 megawatts of compute online by the middle of next year.
Wedbush analyst Matt Bryson took a similar view that there is &#34;almost zero demand risk&#34; for Cerebras, while expectations going forward &#34;will likely be solely dictated by the company's ability to execute.&#34;
Feldman told MarketWatch that the company has been able to &#34;sidestep some of the constraints that are in the market&#34; at the moment, including supply for memory and advanced chip packaging.
Demand for DRAM has skyrocketed amid the AI buildout, especially as chip makers such as Nvidia seek high-bandwidth memory, which involves stacking multiple DRAM die.
Cerebras's use of SRAM makes that &#34;less an issue&#34; for the company, Bryson had pointed out in his Monday note.
In the long term, Moore said focus will be on whether its wafer-scale engine can be &#34;a durable competitive advantage&#34; to other AI-chip offerings by providing customers better economics as they scale AI systems.
Don't miss: Micron grew by $1 trillion this year. These two wild cards will determine its trajectory.
-Britney Nguyen
This content was created by MarketWatch, which is operated by Dow Jones &amp; Co. MarketWatch is published independently from Dow Jones Newswires and The Wall Street Journal.
(END) Dow Jones Newswires
06-23-26 1743ET

CBRS

AMZN

Cerebras Systems reported its first earnings as a public company, posting Q1 core revenue of $191.3 million, up 92% year-over-year and beating estimates. Despite better-than-expected results and guidance for Q2, shares fell over 9% in after-hours trading. The AI chip maker highlighted strong momentum with customers like OpenAI and AWS, leveraging its wafer-scale integration technology to sidestep memory supply constraints.

- Cerebras Systems reported its first earnings as a public company, posting a core revenue of $191.3 million, surpassing analyst expectations.  
- Despite positive results, the stock fell over 9% in after-hours trading due to concerns about the company's ability to scale compute capacity effectively.  
- Analysts noted significant agreements with major clients like OpenAI and AWS, highlighting the technology's potential as a competitive advantage in the AI chip market.

Dow Jones

Cerebras

Amazon

Tradr 2X Long CBRS Daily

Leverage Shares 2X Long CBRS Daily ETF

Tradr 2X Short CBRS Daily ETF

Direxion Daily AMZN Bear 1X Shares

Tradr 2X Short AMZN Daily ETF

Direxion Daily AMZN Bull 2X Shares

Roundhill AMZN WeeklyPay ETF

Yieldmax Amzn Option Income ETF

GraniteShares 2x Long AMZN Daily ETF

Graniteshares YieldBOOST AMZN ETF

Kurv Yield Premium Strategy Amazon AMZN ETF

Roundhill Daily 2X Lon Mag Sev ETF

Nano Labs

OpenAI

NVIDIA

Morgan Stanley

Micron Tech

News

NVIDIA Corporation

MORGAN STANLEY DEP SHS EA REP 1/1000 SHS NON CUM PFD O

MORGAN STANLEY DEP SHS REPSTG 1/1000TH PFD SER Q

MORGAN STANLEY DEP SHS REPS 1/1000 7.125% PFD E

MORGAN STANLEY NON-CUM DEP SH REP 1/1000 PFD SER I

MORGAN STANLEY 4.875 DEP SHS REP 1/1000 NCUM PFD SR L

MORGAN STANLEY 6.5%DEP SHS REPSTG 1/1000 NON CUM SER P

MORGAN STANLEY DEP SHS REPS 1/1000 PFD SER 'A'

MORGAN STANLEY DEP SHS REPR 1/1000TH INT PFD SER 'F' FX

MORGAN STANLEY DEP SHS REP 1/1000 NON-CUM PFD STK SER K

News Corporation Shs B Chess Depository Interests repr 1 Sh

News Corporation Shs A Chess Depository Interests repr 1 Sh

Cerebras delivers its first earnings report - but it's not enough to lift the stock