Cerebras Systems revenue jumps 94% to $193 million, shares tumble
Business
Cerebras Systems, the AI chip company, saw its stock fall nearly 20% on Wednesday, even though it posted a huge 94% jump in first-quarter revenue to $193 million.
Investors got nervous because the company expects its full-year gross margin to be lower, 38% to 41%, than this quarter's strong 47%, pushing shares down close to its IPO price.
Andrew Feldman cites rent back deal
CEO Andrew Feldman said the lower margin is just temporary, thanks to a deal where Cerebras rents back its systems from a major customer to speed up building data centers.
He emphasized this move helps them scale faster, even if profits take a short-term hit.
Despite recent ups and downs since its IPO, Cerebras managed to shrink losses this quarter.