CBRS Earnings Recap
Beat 1 of last 1 quarters
The Buildout is a website built on agentic AI tools, currently in beta, and could have factual errors.
Cerebras' aggressive data center expansion and manufacturing scale-up signal continued robust demand for AI inference infrastructure. Their disaggregation strategy with AMD and AWS could expand the addressable market and improve utilization of existing GPU footprints, potentially influencing broader AI infrastructure deployment patterns.
Cerebras delivered record core revenue of $209.9M, up 103% YoY, with core cloud revenue up 287% YoY. Core gross margin improved 940 bps YoY to 40.6%, but declined sequentially due to renting back systems. Core operating margin improved to -16% from -42% YoY. The company secured over 600 MW of data center capacity, expanded manufacturing capacity 10x, and announced disaggregated inference partnerships with AMD and AWS. They also added customers including Figma, Cognition, Lovable, Block, AlphaSense, GSK, and CrowdStrike.
Management expects core revenue to more than triple in 2027 and continue growing at multiples in subsequent years, supported by $25.4B in RPO. Q3 is expected to be the low point for core gross margin (38-40%) before improving in Q4 as lower-cost owned systems replace rented capacity. They plan to double speed annually and increase throughput by more than 20x by end of 2027, with CS5 launching in H2 2027. They expect AWS Bedrock availability in Q1 2027 and first revenue from other hyperscalers starting mid-2027.
“Fast inference unlocks new applications and new markets.”
on Market opportunity
“We now have data centers either up or under contract in Alabama, Dallas, Denver, Minneapolis, Santa Clara, Stockton and outside the U.S. in France, Finland, Manitoba, Montreal, Norway, Saskatchewan and Toronto.”
on Capacity expansion
“The market has recognized that fast tokens are more valuable tokens.”
on Pricing power
How do you think about customer concentration next year, and can you speak to talks with Google and Microsoft?
Andrew acknowledged OpenAI will remain a meaningful portion but will shrink as a percentage over time as AWS and other customers grow. He noted historical pattern of expanding customer base from government to sovereign to frontier lab to hyperscaler.
Can you walk us through the economics of the Amazon deal and how it will be offered?
Andrew said the service will be deployed in Amazon data centers, delivered through Bedrock API, and expects it to be live in Q1 2027.
Is the AMD deal structured so you buy Helios racks and keep all revenue, or is there revenue sharing?
Andrew confirmed Cerebras purchases the Helios racks and retains the revenue from customers renting the disaggregated solution.