Cerebras shares jump on a first adjusted profit, but most of its $26 billion order book is a delayed OpenAI deal

Cerebras Systems gave investors two things they wanted on Thursday: a profit, by its own preferred measure, and a higher sales forecast. Its shares rose about 18% in after-hours trading. Reuters reported they were up more than 14% before Friday's open.

The harder news came on the call with analysts. Most of the AI chipmaker's $26.1 billion in contracted future revenue comes from one customer, OpenAI. Cerebras is running late on building the computing capacity it promised OpenAI. The contract lets either side cancel any portion delayed by 90 days or more.

That is now the central question for Cerebras investors. The growth is real. But the order book depends on a single buyer and on how fast data centers can be built.

What the quarter showed

Under standard accounting, revenue for the quarter to September 30 was $210.8 million, up 55% from a year earlier. Cerebras prefers a "core" measure. It adds back about $36 million of non-cash charges for stock warrants given to customers, and removes about $16 million of data center costs passed through to customers. On that basis, revenue was $230.9 million, up 70% and ahead of the company's own guidance.

Core net income was $29.8 million. Cerebras called it the first positive result on that measure since its May stock market debut. Under standard accounting, it still lost $161.2 million, or 67 cents a share.

The business is shifting from selling machines to renting out computing. Revenue from its cloud services rose 265% to $141.9 million on a standard basis. Hardware sales fell to $68.9 million from $96.8 million, a drop of about 29% by machine.net's calculation. On the core measure, cloud services now make up roughly 63% of revenue.

For the fourth quarter, Cerebras guided to core revenue of $310 million to $330 million, about 85% growth. It raised its full-year range to $940 million to $960 million. Management repeated that it expects to triple revenue in 2027.

Profitability still has far to go. The company's long-term targets are a 60% gross margin and a 40% operating margin. Last quarter, its core gross margin was 41% and its core operating margin was minus 14%. Cerebras holds about $7.8 billion in cash and investments, plus an unused $850 million credit line.

One customer, running behind

OpenAI's deal is a take-or-pay contract for 750 megawatts of computing. That means the buyer pays for committed capacity whether or not it uses it. Finance chief Robert Komin said the deal "represents the majority of our reported RPO," the industry shorthand for contracted revenue not yet booked.

Chief executive Andrew Feldman told analysts the company was "running behind schedule on the initial tranches." Cerebras has already subtracted estimated delay credits, which are discounts owed for late delivery, from its backlog figure.

Management blamed shortages of land, power and finished buildings, not its chips. It expects to be back on schedule in the second half of 2027. Komin estimated that less than 5% of committed megawatts could be subject to cancellation this year. The company said no cancellations have been received.

Feldman added that OpenAI's own data centers are also behind schedule. He confirmed the contract gives OpenAI the right to switch to buying hardware outright, which would change how and when Cerebras books that revenue. OpenAI also gave Cerebras an upfront $1 billion working-capital loan in January. Komin said that loan, plus customer payments for data center fit-out, funded most of this year's working capital and capital spending.

The result is a supplier tied to one customer on both sides of its finances: as its biggest buyer and as a lender.

A wider customer list, a cheaper stock

Cerebras is trying to show it is more than an OpenAI supplier. It has signed Microsoft and Oracle, which join Amazon Web Services as large cloud customers, three in six months. Oracle plans to offer Cerebras computing through its cloud from summer 2027. Feldman said more details on the Microsoft deal will come in the first half of 2027.

Neither deal does much for the backlog yet. Oracle signed after September 30, so it is not in the $26.1 billion figure. Other named customers include Cognition, Figma, Block, Bilt and Fireworks AI.

The stock shows the skeptical view. Cerebras priced its IPO at $185 a share in May, raising $5.55 billion, and opened at $350 on its first day. By October 1 it had slipped below its offer price, after restrictions on insider selling ended and two executives filed notices of intent to sell about $84 million of stock.

Shares closed Thursday at $97.75, about 47% below the IPO price by machine.net's calculation, before the after-hours jump. Analysts kept positive ratings, but most trimmed price targets, according to MarketScreener. Citigroup cut its target to $250 from $320, and Mizuho to $240 from $300. Wedbush raised its target to $205 from $190.

For companies buying AI computing, Cerebras pitches itself as the fastest way to run AI models and says it is far cheaper at high speeds. For investors, the next tests are concrete. Does the first OpenAI capacity arrive on the revised timetable? And do the Microsoft and Oracle deals show up as signed dollars in the backlog next year?