Cerebras plunges 30% in two days! High expectations for AI chips backfire, performance guidance fails to bridge valuation gap

``` Cerebras's performance guidance falls short of expectations, stock price has plummeted more than 25% over two days. Artificial intelligence chip company Cerebras Systems saw its stock continue to decline sharply on Thursday, falling as much as 12% during the session to its lowest level since its May IPO, eventually closing down 7.6%. In the previous trading day, Cerebras's stock price fell below its initial public offering (IPO) price for the first time and recorded a single-day largest decline of 20%. The company expects its core gross profit margin in the second quarter to shrink significantly from 46.5% in the first quarter to 36%-38%, and its annual core operating profit margin to range from negative 28% to negative 32%. Investors were disappointed by the company's full-year outlook, triggering a sell-off.

The consecutive declines have caused the company's stock price to fall nearly 50% from the all-time closing high of $311 on its first day of trading, and its market value has evaporated by nearly $30 billion. Cerebras’s IPO this year was the largest since 2026, but was later surpassed by SpaceX. Located in Sunnyvale, California, Cerebras mainly designs artificial intelligence chips and operates AI data centers, aiming to compete with Nvidia. As the AI boom continues to heat up, investors have high hopes for the company and have become accustomed to the industry frequently delivering “better-than-expected” performance results. Although Cerebras expects its fiscal 2026 revenue to be between $855 million to $865 million, higher than analysts’ consensus estimate of about $825 million, the market had originally hoped the company could grab a larger share in the rapidly growing AI data center market, so this outlook still failed to meet investors’ high expectations. Cerebras released its earnings after the close on Tuesday, and the whole chip sector had already seen broad-based sell-offs due to market concerns over slowing future demand after a rapid run-up. On Thursday, the US stock market’s semiconductor sector saw dramatic swings. Micron’s strong earnings report temporarily boosted market sentiment; but afterwards, DeepSeek announced massive hiring across all departments, causing US stocks to fluctuate once again. Risk warning and disclaimer The market has risks, and investment needs caution. This article does not constitute personal investment advice, nor does it take into account the individual user’s specific investment objectives, financial situation, or needs. Users should consider whether any opinions, views, or conclusions in this article suit their particular circumstances. Investments made based on this article are at your own risk. ```