AI chipmaker Cerebras saw its shares fall after forecasting weaker margins, even as revenue surged and second-quarter sales guidance beat estimates.
AI chipmaker Cerebras Systems saw its shares fall nearly 10% in extended trading after its first earnings report as a public company raised concerns over profitability despite strong revenue growth.
The company forecast full-year 2026 adjusted gross margins of 38%–41%, below the 47% reported in the first quarter. The projected margins also trail rivals such as Nvidia and AMD, whose margins remain significantly higher.
For the second quarter, Cerebras expects adjusted sales of $194 million, above analyst estimates of $174.34 million, according to LSEG data.
According to Reuters, The company reported first-quarter revenue of $193.4 million, up from $99.5 million a year earlier. Its adjusted net loss narrowed to $2.5 million, outperforming analyst expectations of a $36.75 million loss.
Cerebras said margin pressure is being driven by short-term capacity constraints as it temporarily rents third-party computing capacity while expanding infrastructure.
“The additional cost of renting third-party capacity will depress core cloud and other services margin temporarily from current levels,” CFO Bob Komin said.
The company, which raised $5.55 billion in its IPO last month, said it aims to achieve gross margins of 60% over the long term while expanding data centre capacity globally.
