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TechOct 1, 2024

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

Silicon Ambition

Noah Weidner

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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.