Chip Designer Cerebras Systems Files For IPO, Offering Investors An Alternative To AI Heavyweights Like Nvidia and AMD

After making boatloads of cash on AI plays like Google ($GOOGL) and Microsoft ($MSFT), investors are on the lookout for the next Nvidia ($NVDA) or AMD ($AMD) — and Cerebras Systems is hoping to capture investors’ hearts (and leftover profits). The lesser-known AI chip designer filed for an IPO on Tuesday, making it the first chip company to go public since ChatGPT’s debut.

• Founded in 2015, Cerebras only started generating significant revenue after the pandemic. In 2022, it earned $24.6M; in 2023, that figure jumped to $78.7M.
• The up-and-coming AI chipmaker’s earnings and net loss have both improved, with revenue reaching $136.4M in the first half of 2024 (up from $8.7M in H1 2023), while its net loss narrowed to $66.6M (from $77.8M).

Testing the model: Cerebras claims its third-gen WSE-3 AI chip outperforms Nvidia’s H100 in several areas. However, investors may be cautious due to the innovative processor design firm’s concentrated client base — 83% of its revenue comes from just one client. This heavy reliance could make its $7B to $8B valuation a tough sell, especially as Wall Street weighs the risks amid talks of a potential slowdown in AI growth.