Cerebras Systems (CBRS) climbed about 18% in after-hours trading on Thursday after reporting third-quarter results above Wall Street expectations and announcing a new cloud agreement with Microsoft. Core revenue came in at $230.9 million, up 70% from $135.7 million a year earlier and above the $214.7 million consensus forecast. Adjusted earnings reached 12 cents per share, while analysts had expected a loss of 14 cents. The company strips out some items to calculate adjusted revenue, including pass-through revenue and noncash reductions tied to customer warrants. Adjusted operating margin was negative 14%, an improvement from the roughly negative 24% guided three months earlier.
The backlog edged up to $26 billion from $25 billion in the previous quarter, with a significant portion linked to the OpenAI cloud agreement signed in late 2025; OpenAI accounted for 32% of revenue in the June quarter. CEO Andrew Feldman said the Microsoft contract was signed in October, and revenue from it should begin appearing in the first quarter of 2027. Cerebras already has agreements with Amazon and Oracle, and the Oracle deal closed after the quarter, so it is not included in the backlog. Feldman also pointed to long GPU lead times and higher costs as an opening for Cerebras hardware sales.
For the fourth quarter, Cerebras expects revenue of $310 million to $330 million, well above the $271 million analyst consensus, and guided core gross margin to 47% to 49% versus the 42.1% expected. The company also indicated revenue is expected to triple in 2027, implying about $2.85 billion. The results landed the same day Nvidia CEO Jensen Huang resigned from the company he co-founded. Despite the post-earnings jump, CBRS remains about 47% below its May IPO price.
