Cerebras Systems Inc. raised $5.55 billion in its US initial public offering, as the artificial intelligence chipmaker seizes on the surging demand for semiconductors. The company priced its shares at $185 each, above the marketed range, according to a statement confirming an earlier Bloomberg News report. CEO Andrew Feldman speaks with Bloomberg Technology from the Nasdaq MarketSite in Times Square ahead of the listing's open.
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What Andrew Feldman said
Written from the verified transcript and checked against it. Every figure links to the moment it was said.
Andrew Feldman, CEO of Cerebras Systems, discussed the company's IPO, which priced at $185 per share and was indicated to open at $350. He called it the biggest semiconductor IPO in history, culminating a decade of work. Feldman highlighted a deal with OpenAI worth over $20 billion for 750 megawatts of compute and a binding term sheet with AWS for deployment in their data centers, emphasizing Cerebras' 15x speed advantage over competitors. He addressed retail investor allocation, noting the offering was over 25x oversubscribed. On margins, he cited 41% gross margins and plans to improve cost structure and potentially raise prices. He explained the wafer-scale chip design, comparing it to a dinner plate versus a postage stamp, and justified vertical integration by analogy to Porsche. He said IPO proceeds would increase capacity to meet overwhelming demand for fast inference.
Key takeaways
Cerebras priced IPO at $185 per share, with shares indicated to open at $350, marking the biggest semiconductor IPO in history.
Signed a deal with OpenAI worth over $20 billion for 750 megawatts of compute.
Signed a binding term sheet with AWS for deployment in their data centers, part of Bedrock offering.
Cerebras is 15 times faster than the nearest competitor in inference.
IPO was over 25x oversubscribed, leading to tough allocation decisions.
Price this IPO, Andrew, at $185 a share above the top end of the market range. I'm looking at the Bloomberg terminal. Shares indicated to open $350 a share. Your reaction to that?
How do you feel? I mean, do you see this coming? There's some mechanics to it, right? But I, you know, I know you. I know you like to, let's be honest, you like to talk about what's happening in AI, the big focus on inference, Cerebras' place in it. But this is the biggest IPO of the year so far. You know, what does it mean to you and your employees and your backers?
It's the biggest tech, one of the biggest tech IPOs in history, and it's the biggest semi IPO in history. We couldn't be more proud. This is the culmination of a decade of work, of countless late nights and long weekends. We are enormously proud and excited and ready to get back to work and start working on the next great thing.
Again, the market is indicating shares to open at $350 a share. Let's see where we're at when trading starts. But you're being priced in as a major player in this field now. What evidence would you point to that you are in fact a major player? A lot of focus is on the concentration in the relationship with OpenAI. Tell me about some of the other frontier labs or other names that you have some concrete talks with.
Sure. In the last four months, we announced a deal with OpenAI that's north of $20,000,000,000 for 750 megawatts of compute. We also announced a major engagement with AWS, where our equipment would be deployed in their data centers. I think those are obviously the largest, but there are dozens of others that are in what used to be a big deal in the $10 to $50,000,000 category. And so there's just an extraordinary demand right now for fast inference. We're the fastest, not by a little bit, but by more than an order of magnitude. You know, we're 15 times faster than the next nearest competitor. And as AI has become useful, everybody wants it to be fast. Nobody wants to wait.
On that, you know, 21x on performance and also, like, a lot of emphasis on the dollar per token, right? That is the metric that the field cares about. But that's on paper. You know, you just talked about the AWS relationship as an engagement. When does the word engagement end and real revenues start to show up for you from those relationships?
Sure. We signed a binding term sheet with AWS as described in our S-1, and we're working through the master agreement. I think in dealing with organizations of that size, it takes a little time to dot all the i's and cross the t's. But we are extremely confident that they will be an enormous channel for us and a partner in delivering our technology to large enterprises and medium-sized enterprises around the world. I think they are one of the preferred cloud providers for just about every enterprise on Earth. And so, an opportunity to have your solution embedded in their offering as part of their Bedrock offering, that's a huge win for us.
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