Did The Market Read Cerebras Stock Right?
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Cerebras Systems (CBRS) stock fell 57.6% from August 4 to November 2, 2026, while the S&P 500 lost 2.3%. Shares slid following the company’s August 12 second-quarter report, and they dropped again in late September and early October as reports said Cerebras lost an OpenAI workload to Nvidia. The price appears to assume Cerebras’s growth is less secure than it looked, so how much of that growth depends on OpenAI?
Much Of Cerebras’s Backlog Comes From OpenAI
A large part of the business Cerebras has already signed depends on OpenAI. The company had $25.4 billion of contracted work still to deliver at June 30. On the August 12 call, management said none of it came from AWS or any other large cloud provider. September news reports said a significant amount of that backlog traces to a December agreement with OpenAI.
Management said on that same call that OpenAI will still be a meaningful portion of revenue in 2027, and that share will shrink over time as AWS and other customers grow.
The late-September news concerned the customer behind much of that backlog. News reports that week, including on October 2, said Cerebras lost a key workload for OpenAI’s Ultrafast mode to Nvidia during the same week a lockup on early holders’ shares expired. On October 5, OpenAI’s chief executive called Cerebras a close partner, and the shares rose 11% in early trading. They still lost 42.1% between October 2 and November 2. Late in October, short seller Culper Research disclosed a position against Cerebras, and the shares fell 11.7% to a record low on November 2.
Cerebras Reported A Far Wider Loss In August
The losses have not narrowed yet. Cerebras reported revenue of $180 million for the quarter ended June 30, up from $103 million a year earlier but below the $193 million reported for the three months to March 31. The company’s operating loss grew to $477 million from $15 million in the prior quarter, though management’s own core operating loss was far smaller at $33.6 million. Gross margin fell to 14.2% from 44.6% three months earlier. News reports said the shares slumped more than 18% before trading opened on August 13 after the company missed key estimates.
On that core measure, revenue rose 103% to $209.9 million, but management expects weaker third-quarter margins. The company guided core operating margin to minus 25% to minus 23%, against minus 16% in the second quarter. For the full year, management raised its core revenue outlook to $880 million to $890 million. Management also called the third quarter the low point for core gross margin, with an improvement in the fourth as more of its own lower-cost systems come online.
Cerebras Holds $7.9 Billion In Cash
At June 30, Cerebras held $7.9 billion in cash and short-term investments, against debt of $1.5 billion. That cash equals about a third of the company’s roughly $22 billion market value at the November 2 close.
Investors now pay far less for each dollar of sales. The share price has fallen 46% since September 30 with no new sales report, so the multiple of sales has nearly halved. Even so, it remains far above the S&P 500’s 3.3 times.
That cash shrinks while Cerebras loses money. When the company reports in November 2026, the number to watch is core gross margin, which management guided to 38% to 40% for the third quarter. That measure was 40.6% in the second quarter.
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