Cerebras’ Revenue Surge in IPO Filing: Poised to Shake Up AI Chip Market and Challenge Nvidia

Cerebras Systems, a startup that is trying to take on Nvidia in the AI chip market, has reported a major increase in its revenue. The company shared the news on Monday in a filing as it plans to go public in the U.S.

In 2024, initial public offerings (IPOs) in the U.S. have picked up after a slow two years. The rise in IPOs is driven by hopes for a stable economy and record-high stock prices. Analysts predict more tech companies will go public soon, with AI firms leading the way.

Cerebras’ revenue jumped to $78.7 million for the year ending in December 2023, up from $24.6 million the year before. Its loss per share also improved, narrowing to $2.92 from $4.28.

The company said that 83% of its revenue came from AI tech group G42, which is partly owned by Abu Dhabi’s sovereign investor, Mubadala. Cerebras highlighted its relationship with G42 as a key factor that could impact its future performance.

Citigroup and Barclays are the lead underwriters for the IPO, with Cerebras planning to list on Nasdaq under the ticker symbol “CBRS.” While the company hasn’t shared the exact terms of the IPO, Bloomberg News reported that it could aim to raise up to $1 billion.

The AI Race

Cerebras is looking for investors for its IPO as excitement for AI chip companies remains strong. The company expects the AI computing market to grow from $131 billion in 2024 to $453 billion in 2027, according to its IPO prospectus.

Dan Coatsworth, an investment analyst at AJ Bell, told Reuters that many tech companies could go public in the U.S., as investors are eager to back new innovations. “Anything related to AI will have a good story to tell, and investors love that when looking for new opportunities,” he said.

Nvidia’s stock has surged by about 140% this year, making it one of the most valuable companies in the world. Its advanced hardware is used by companies like OpenAI, which powers popular apps such as ChatGPT.

Cerebras is hoping its unique foot-wide chip can perform better than Nvidia’s, which uses thousands of smaller chips working together. In August, Cerebras launched a tool for AI developers to use its large chips for running applications, which it claims is a cheaper option than using Nvidia’s processors.