"NVIDIA Corporation challenger" Cerebras (CBRS.US) reported Q2 results that fell short of expectations, with hardware revenue plummeting 23%, and the stock price dropped 16% in after-hours trading.

On Wednesday after hours, AI chip newcomer Cerebras Systems (CBRS.US) announced disappointing second-quarter results, causing its stock price to plummet by 16%. According to data, the companys Q2 revenue grew by 74% year-over-year to $180.1 million, compared to analysts expectations of $194 million; the loss per share was $2.98, while analysts had expected a loss of $0.17 per share. By business segment, second-quarter hardware revenue fell 23% year-over-year to $54.1 million. This indicates that the startup, which uses an innovative chip design architecture, still faces challenges in its commercialization process. However, revenue from cloud and other services reached a record high of $126 million, up 281% year-over-year. The core gross margin for the second quarter was 41%, an increase of approximately 940 basis points compared to the same period last year. Since its initial public offering in May, Cerebras's stock price has risen by 42%. Cerebras positions itself as a challenger to NVIDIA Corporation in the AI chip sector, but its largest source of revenue currently comes from cloud computing services. Cerebras CEO Andrew Feldman stated, From the timing of order deliveries and revenue recognition, the hardware business will show volatility. This is due to the nature of the industry. He added that some customers are currently not prepared to accommodate the data center space needed for the new computing systems. Notably, other computing chip and hardware manufacturers have achieved strong growth in the recent quarter. AMD's latest quarterly sales increased by 50%, while Intel Corporation also saw a 25% rise. In contrast, Cerebras is still in the early stages of customer expansion and technology promotion, with relatively low predictability in its hardware revenue. Feldman emphasized that the company remains committed to selling hardware systems and data center services. Looking ahead, Cerebras expects third-quarter revenue to be around $215 million, exceeding the average analyst expectation of $212 million; the core gross margin is expected to be between 38% and 40%, also higher than the average analyst forecast of 36%. The company has raised its full-year revenue guidance to between $880 million and $890 million, up from its previous expectation of $855 million to $865 million, while analysts generally anticipated $867.6 million. The company also expects its full-year core gross margin to be between 41% and 43%. Cerebras's core technological selling point lies in its unique high-end processor design philosophy, which processes a silicon wafer typically used to manufacture multiple components into a single chip. Cerebras has built a vast data center network and offers computing power rental services to validate the feasibility of its technology. With the current strong demand for AI computing power, these rental services have become an important growth engine for the company.