Artificial intelligence (AI) chip startup Cerebras Systems has filed its prospectus for an initial public offering (IPO) with plans to list on the Nasdaq under the symbol “CBRS.” Founded in 2016 and headquartered in Sunnyvale, California, the company has gained notoriety in the AI chip industry by directly competing with giants like Nvidia.
Cerebras’ WSE-3 chip, described on its website as superior to Nvidia’s H100 in terms of cores and memory, is physically larger and designed to handle more complex artificial intelligence models. In addition to selling chips, Cerebras also offers cloud-based services, relying on its own computing clusters to provide advanced AI solutions, CNBC reports.
A competitive and growing market
The AI chip market is highly competitive and growing rapidly, with tech giants such as Amazon, Google and Microsoft developing their own chips to train and run AI models. Cerebras Systems faces fierce competition, not only from Nvidia, but also from companies like AMD, Intel, and custom solutions developed by the technology companies themselves.
An interesting fact is that Group 42, a UAE-based AI firm that counts Microsoft as one of its investors, accounted for 83% of Cerebras’ revenue last year, highlighting the company’s dependence on large companies. business agreements to sustain their growth.
Cerebras financial performance
Despite the projection and success in its sector, Cerebras remains a losing company. In the first six months of 2024, the company posted a net loss of $66.6 million on revenue of $136.4 million. In 2023, the company reported a net loss of $127 million on revenue of $78.7 million, reflecting improved sales but an ongoing challenge in terms of profitability.
However, revenue growth in the second quarter of 2024, which amounted to $69.8 million compared to $5.7 million in the same quarter last year, shows positive momentum in the adoption of its AI solutions.
Investors and valuation
Cerebras Systems was valued at more than $4 billion following a $250 million financing round in 2021. Its investors include notable names such as Abu Dhabi Growth Fund, Altimeter Capital, Benchmark, Foundation Capital, and key figures in the technology sector such as OpenAI CEO Sam Altman and Sun Microsystems co-founder Andy Bechtolsheim.
Cerebras’ largest shareholder is the venture capital firm Foundation Capital, followed by Benchmark and Eclipse Ventures. Among individual investors, Andrew Feldman, the company’s co-founder and CEO, is the only one with more than a 5% stake.
Context of technology IPOs in 2024
The technology market has seen a decline in IPOs during 2024, mainly due to rising interest rates, which has diverted investor interest towards more profitable assets. However, some key tech companies like Reddit and Rubrik have managed to go public so far this year, taking advantage of the change in market conditions.
With the recent rate cut by the Federal Reserve, technology companies, such as Cerebras, are looking to take advantage of the renewed optimism in the sector.
In summary
The Cerebras Systems IPO represents a new opportunity for investors seeking to capitalize on the growth of the AI chip market, an increasingly competitive sector. With strong backing from key investors and advanced technology, Cerebras will seek to consolidate itself against giants like Nvidia and take advantage of the growing interest in AI solutions globally.
Do you want to always be updated in the world of cryptocurrencies? Subscribe now to the CriptoTendencia WhatsApp channel! Here you will instantly receive the most relevant information about Bitcoin, Altcoins, DeFi, NFTs, Blockchain and the Metaverse.
Related
Crypto Keynote USA
For the Latest Crypto News, Follow ©KeynoteUSA on Twitter Or Google News.
