A chip company that made history in May with the largest semiconductor stock market debut on record published its first set of financial results as a public company on Tuesday evening, showing revenue that almost doubled from a year earlier. The market’s response was to send its shares down sharply in after hours trading.
Cerebras Systems reported revenue of $193.4 million for the three months to the end of March, a rise of 94 per cent compared with the same period a year earlier. The core figure, which strips out certain accounting adjustments, came in at $191.3 million, representing a 92 per cent increase year on year. Hardware sales accounted for the majority of that total at around $110 million, with cloud and computing services contributing close to $83 million. Both figures came in ahead of what analysts had been expecting.
The headline loss numbers improved significantly. The company reported a net loss under standard accounting rules of $14 million for the quarter, down from $23.9 million in the same period a year earlier. On a narrower internal measure that the company uses to track its underlying performance, the net loss shrank to just $2.5 million, bringing the business close to breaking even on that basis.
Andrew Feldman, the co-founder and chief executive of Cerebras, described the period as an outstanding start to the year. Looking ahead, the company said it expects second quarter revenue of approximately $194 million and forecast full year revenue of between $855 million and $865 million, representing growth of around 69 per cent at the midpoint compared with 2025. That forecast exceeded what analysts had projected.
Given all of that, the immediate market reaction requires some explanation. Shares fell more than nine per cent in after hours trading following the results announcement. Two things appear to have driven that reaction. The first was the profit miss on the measure that many investors focus on most closely. On the adjusted loss per share figure, Cerebras came in at 22 cents, wider than the 16 cent loss analysts had forecast. That gap between reported and expected performance on a per share basis tends to move share prices sharply, even when the underlying revenues look strong.
The second, and arguably more significant, concern was the company’s own warning about the profitability of its core operations in the quarter ahead. Cerebras said it expects its core gross margin, the proportion of revenue left over after direct costs are subtracted, to narrow to between 36 and 38 per cent in the second quarter. The first quarter figure had come in at 47 per cent. A ten percentage point drop in a single quarter raises questions about whether the strong early margins can be sustained as the business grows and competition intensifies.
As reported, the results mark the first time Cerebras has reported public financial figures since listing on the Nasdaq on the 14th of May. The initial public offering priced shares at $185 each, raising more than $6 billion in total, making it the largest stock market debut by a semiconductor company in history and the most significant by a United States technology company since Uber went public in 2019. On the first day of trading the shares opened at $350 and closed at $311. By Tuesday, before the results were published, the stock had retreated to $226.72, already down 28 per cent from that opening price.
The company was founded in 2015 and has built its business around a fundamentally different approach to the design of processing chips. Rather than combining many smaller chips together on a circuit board, Cerebras manufactures what it calls a wafer scale chip, a single enormous piece of silicon that is many times larger than any conventional processor. The company says this architecture allows it to process certain demanding computing tasks considerably faster than conventional chips, making it particularly competitive for running large programmes that require rapid responses.
Two deals announced alongside the results underline the scale of commercial interest in that capability. Cerebras disclosed a multi year agreement with OpenAI worth more than $20 billion, under which OpenAI will use Cerebras computing infrastructure to handle workloads requiring 750 megawatts of processing power. The company also announced a partnership with Amazon Web Services, the cloud computing arm of Amazon, to make Cerebras processing available to businesses using Amazon’s platform. Both agreements are structured to run over multiple years and together give Cerebras a degree of revenue visibility that most companies of its age and size cannot claim.
The company ended the quarter with $3.3 billion in cash and liquid assets, a position it described as sufficient to fund its expansion plans without the need for further fundraising in the near term. A separate credit facility of $850 million is also available if required.
Whether the margin warning proves to be a temporary feature of rapid growth or something more persistent will be the question investors watch most closely over the coming quarters. For now, the company that was built to challenge the dominance of the world’s most powerful chip businesses has delivered its first public test of whether the numbers can match the ambition. The answer, on Tuesday evening, was broadly yes, with one significant caveat attached.
About the Author
Marcel Chidozie is a tech analyst and writer covering foreign news, fintech, and emerging technologies at TechRegard. Based in Nigeria, He's passionate about translating complex tech developments into compelling, accessible stories for diverse audiences. His work focuses on how technology shapes innovation across Africa and globally.
