TLDR:
- Cerebras Systems filed for IPO, planning to list on Nasdaq as “CBRS”
- Company reported $136.4M revenue in H1 2024, up from $8.7M in H1 2023
- Cerebras competes with Nvidia in AI chip market
- G42, a UAE-based AI firm, accounted for 83% of Cerebras’s 2023 revenue
- Company faces competition from major tech giants and startups in AI chip space
AI chip manufacturer Cerebras Systems has filed for an initial public offering (IPO), shedding light on its financial performance and position in the competitive artificial intelligence semiconductor market.
The company, founded in 2016 and based in Sunnyvale, California, plans to list on the Nasdaq Global Market under the ticker symbol “CBRS.”
Cerebras reported significant revenue growth in recent years. For the first half of 2024, the company recorded sales of $136.4 million, a substantial increase from $8.7 million in the same period of 2023.
The full year 2023 saw revenue of $78.74 million, more than triple the $24.62 million reported in 2022.
Despite this growth, Cerebras continues to operate at a loss. The company reported a net loss of $66.6 million for the first six months of 2024, an improvement from the $77.8 million loss in the same period of 2023. For the full year 2023, Cerebras recorded a net loss of $127.16 million, compared to a $177.72 million loss in 2022.
Cerebras designs processors specifically for AI training and inference, as well as building AI systems to power these processors and feed them data.
The company’s flagship product, the WSE-3 chip, is marketed as having more cores and memory than Nvidia’s popular H100 GPU. Cerebras also offers cloud-based services utilizing its own computing clusters.
The IPO filing reveals that Cerebras relies heavily on a single customer for its revenue. Group 42 (G42), a UAE-based AI firm with investment ties to Microsoft, accounted for 83% of Cerebras’s revenue in 2023. In May, G42 committed to purchasing $1.43 billion in orders from Cerebras before March 2025.
Cerebras enters a crowded and competitive market for AI chips. The company faces competition from established tech giants like Nvidia, AMD, Intel, Microsoft, and Google, as well as from other startups and internally developed chips from major cloud providers. Taiwan Semiconductor Manufacturing Company (TSMC) manufactures Cerebras’ chips, and the company warns that potential supply chain disruptions could impact its operations.
The IPO is led by Citigroup and Barclays, with UBS Investment, Wells Fargo Securities, and Mizuho also serving as underwriters. Notable investors in Cerebras include venture firms Foundation Capital, Benchmark, and Eclipse Ventures, as well as Alpha Wave, Coatue, and Altimeter.
Individual investors include OpenAI CEO Sam Altman and Sun Microsystems co-founder Andy Bechtolsheim.
Cerebras’ IPO comes at a time when the AI chip market is experiencing significant growth, driven by the increasing adoption of AI applications across various industries.
The success of companies like Nvidia in this sector has sparked investor interest, though concerns about potential market euphoria remain.
The timing of Cerebras’ public offering aligns with a general improvement in market conditions for tech IPOs in 2024. Receding recession fears and a strong equities rally have contributed to a more favorable environment for public listings, following two years of relatively subdued IPO activity.
