Cerebras stock experienced a notable recovery in premarket trading, rising 6.3% to $177 per share after a sharp decline of 20% the previous week. This drop was triggered by news that OpenAI would utilize Nvidia's graphics processing units for its 'Ultrafast' mode in the upcoming GPT-6.1 Sol, rather than Cerebras' own chips.
Sam Altman addressed the situation on social media, emphasizing that Cerebras remains a 'close partner' and highlighting their ongoing collaboration in advancing AI technology. Following Altman's comments, Cerebras' stock gained nearly 3% in extended trading on Friday.
Despite this rebound, the stock is still down almost 50% from its post-IPO high, with a current market capitalization of just over $39 billion, significantly lower than the $95 billion valuation at its IPO in May. Cerebras, which competes with Nvidia, specializes in large computer chips and AI systems designed to enhance the speed of AI model processing.
The company has a $10 billion agreement with OpenAI to provide substantial computing power through 2028. Analysts from Citi have maintained their revenue outlook for Cerebras, suggesting that while initial AI models may run on internal chips, the long-term impact on Cerebras' performance will depend on the stabilization of gross margins.
Any delays in achieving this could negatively affect investor sentiment, especially given the company's premium valuation