Key Takeaways
- Cerebras shares fell about 14% after quarterly revenue missed analyst expectations.
- The company raised full-year core revenue guidance to $880 million to $890 million.
- Cerebras reported a $450.5 million net loss for the quarter.
Cerebras shares fell about 14% in extended trading after the AI chipmaker reported quarterly revenue below analyst expectations, despite raising its full-year revenue forecast. The market reaction came as investors weighed the revenue miss, profitability, and margins against continued growth in AI computing demand.
Revenue miss puts pressure on Cerebras shares
Cerebras reported total revenue of $180.1 million for the second quarter, up 74% from $103.3 million a year earlier. The figure was below the $194 million expected by analysts. Core revenue, which excludes certain items including pass-through revenue and costs, reached $209.9 million, more than double the year-earlier figure.
The company reported a net loss of $450.5 million, compared with net income of $309.5 million in the same quarter last year. The latest loss included $386.6 million in stock-based compensation expenses.
Cerebras also reported a GAAP gross margin of 14%, while core gross margin stood at 41%. The company said its core gross margin improved by about 940 basis points from the year-earlier quarter. However, its third-quarter forecast calls for a core gross margin of 38% to 40%.
The results came shortly after Cerebras completed its initial public offering in May, making the latest report one of the first major tests for Cerebras shares since the company went public.
Higher forecast signals continued AI demand
Despite the quarterly revenue miss that sent Cerebras shares lower, Cerebras raised its full-year core revenue forecast to $880 million to $890 million, compared with its previous range of $855 million to $865 million. It expects third-quarter core revenue of $214 million to $216 million.
The company also reported $25.4 billion in remaining performance obligations as of June 30, indicating a substantial pipeline of contracted business yet to be recognized as revenue. Cerebras said it expects revenue to more than triple in 2027, a forecast that could support Cerebras shares over the longer term.
Its cloud business was another major growth area. GAAP cloud and other services revenue reached $126 million, an increase of 281% from a year earlier. Core cloud revenue rose 287% to $127.7 million, growth partly fueled by Cerebras’ multibillion-dollar compute agreement with OpenAI.
Cerebras is expanding its infrastructure to support demand for its AI computing systems. Data center capacity that is live or under contract for delivery by the end of 2027 has increased to more than 600 megawatts, while manufacturing capacity is expected to increase more than 10 times during 2026.
The company expects core operating margins of negative 25% to negative 23% in the third quarter, before improving over the remainder of the year. For the full year, it expects core operating margins of negative 19% to negative 17%.
The latest results highlight the challenge facing Cerebras shares as it expands rapidly in the AI computing market, according to reports. Revenue and contracted demand are growing sharply, but investors are also watching the pace at which the company can translate that growth into stronger margins and improved profitability.
