Cerebras shares rose 6.3% to $177 in premarket trading on 5 October, after falling 20% the previous week, as OpenAI chief executive Sam Altman publicly reaffirmed the companies’ partnership, CNBC reported.
Key points
- Altman called Cerebras a close partner on 2 October, following a report that OpenAI would use Nvidia GPUs for GPT-6.1 Sol’s Ultrafast mode.
- The companies’ January agreement covers 750 megawatts of Cerebras computing power through 2028 and was valued at $10 billion.
- Up to 19.4 million shares held by Cerebras insiders and other holders became eligible for sale on 30 September.
Altman responds to GPT-6.1 Sol speculation
Altman addressed speculation about OpenAI’s relationship with Cerebras in a post on X on 2 October. “Cerebras is a close partner, and we have a deep engagement pushing on the frontiers of speed,” he wrote. Cerebras shares rose almost 3% in extended trading after his comments, before the larger premarket gain on 5 October.
The preceding sell-off followed a SemiAnalysis report that OpenAI would use Nvidia GPUs, rather than Cerebras hardware, for the Ultrafast mode of its GPT-6.1 Sol model, Stocktwits reported. Cerebras shares closed 1.8% lower at $166.43 on 2 October, their fifth consecutive declining session. Altman’s statement concerned the broader partnership, while the SemiAnalysis report concerned the hardware chosen for one mode.
Barclays analyst Tom O’Malley said the OpenAI relationship remained strong and described Cerebras as OpenAI’s preferred provider, constrained by supply, Seeking Alpha reported. O’Malley also said Nvidia would run GPT-6.1 Ultrafast. O’Malley described Cerebras as OpenAI’s preferred provider despite Nvidia’s role in GPT-6.1 Ultrafast.
OpenAI’s 750-megawatt Cerebras agreement
Cerebras signed a $10 billion agreement with OpenAI in January to provide 750 megawatts of computing power through 2028, CNBC reported.
Cerebras sells large chips and AI systems designed to run models faster than conventional GPUs. The company claims its Wafer Scale Engine 3 runs faster than Nvidia’s GPU. Cerebras has also said it is an OpenAI launch partner for GPT-5.6 Sol, a separate model from the GPT-6.1 Sol named in the Ultrafast report.
In August, Cerebras reported second-quarter revenue of $180.1 million, up 74% from a year earlier, Stocktwits reported. The company also reported $209.9 million in core revenue, a non-GAAP measure that more than doubled. Cerebras had $8.6 billion in liquid assets at quarter-end and $25.4 billion in contracted work still to be fulfilled.
Cerebras shares trade below their $185 IPO price
Cerebras sold shares at $185 each in its May initial public offering, above an indicated range of $150 to $160. They opened at $350 on 14 May. The $177 premarket price on 5 October was below the IPO sale price, even after the gain following Altman’s post.
The company’s market capitalisation stood at just over $39 billion, compared with $95 billion during its May debut.
A separate source of potential share supply emerged on 30 September. Stocktwits reported that post-IPO lockups lapsed on 30 September, allowing directors, officers and other holders to offer as many as 19.4 million Cerebras shares for sale. Eligibility for sale does not itself amount to a sale.
Citi focuses on Cerebras gross margins
Freedom Capital upgraded Cerebras to Buy from Hold on 2 October and set a $209 price target. Its change in rating came during the stock’s losing run, before the premarket rebound following Altman’s post.
Citi analysts said their outlook for Cerebras revenue from 2026 to 2028 was unchanged, CNBC reported. They said new models from frontier AI developers could initially run on internal chips before moving to third-party infrastructure or Cerebras cloud services. Their assessment left the reported Nvidia deployment alongside, rather than in place of, their existing revenue forecast.
The Citi analysts said Cerebras shares’ ability to outperform was increasingly tied to evidence that gross margins were stabilising. A further delay in the gross-margin trough would probably weigh on sentiment, they said, particularly given the company’s premium valuation.
