Cerebras Systems reported better-than-expected revenue and quarterly guidance on Thursday and highlighted a new agreement with Microsoft. The stock jumped 18% in extended trading.
Here is how the company performed against LSEG consensus:
- Loss per share: 67 cents. It was not immediately clear how that compared with the expected loss of 14 cents.
- Core revenue: $230.9 million versus $214.7 million expected.
Core revenue rose 70% from $135.7 million, compared with 103% growth in the second quarter, according to a statement.
“I think there is opportunity created by, particularly on the hardware side, the sale of hardware, where long lead times in GPUs and more expense creates opportunity for us,” CEO Andrew Feldman told CNBC in an interview, referring to graphics processing units.
Feldman said executives would announce a new relationship with Microsoft, one of the world’s top cloud providers, during a conference call with analysts. The call was scheduled to begin at 5 p.m. ET.
“We believe revenue begins to show up in Q1 ’27,” Feldman said in the interview, adding that Microsoft signed the deal in October. Cerebras has also secured agreements with other major cloud providers, including Amazon and Oracle.
Feldman said Cerebras is evaluating financing options to meet accelerating demand.
The company is seeking to challenge Nvidia in the AI chip market. Its earnings arrived on the same day that Nvidia CEO Jensen Huang resigned from the company he co-founded following multiple scandals involving extramarital affairs.
For the fourth quarter, Cerebras expects a core gross margin of 47% to 49%, with revenue of $310 million to $330 million. Analysts polled by LSEG had expected a 42.1% margin and $271 million in revenue.
Cerebras said it expects revenue to triple in 2027, implying about $2.85 billion. Analysts surveyed by LSEG had expected $2.92 billion.
Cerebras shares have fallen about 47% since the company debuted on Nasdaq in May.
