Cerebras lifts annual revenue outlook as cloud demand grows in third quarter

Cerebras raised its full-year outlook on Thursday after reporting third-quarter results. The AI chipmaker now expects core revenue of between $940 million and $960 million for the year.

What happened

The company said continued demand for its cloud services supports the higher guidance. Cloud revenue surged in the third quarter. Direct sales of its artificial-intelligence chips fell over the same period.

Cerebras reported third-quarter revenue and issued strong guidance for the rest of the year. It also said it recently signed a deal with Microsoft, a hyperscaler. Hyperscalers are the very large cloud providers that run data centers at global scale. The company has not made the terms of the agreement public.

The shares rose 11% after the results and the guidance were published. The move followed the release of the numbers after the close of the regular session in the United States.

Why it matters

The results show a shift in the mix of the business. Revenue growth is coming from cloud services, where customers rent access to Cerebras computing capacity. Direct chip sales, the other part of the business, declined in the quarter.

The Microsoft agreement adds a large cloud name to the story. For an AI chip company, a deal with a hyperscaler points to demand from some of the biggest buyers of computing capacity. The size and length of the contract have not been disclosed.

The update also feeds the wider debate on how AI infrastructure spending reaches listed companies. The split between cloud and direct sales shows where Cerebras earns its revenue today, and the higher range gives a clearer picture of the full-year trajectory. For investors who follow the sector, the report is a data point on how demand for AI computing is moving from chip purchases toward rented capacity.

What to watch next

The next checkpoint is how cloud revenue develops against the new range of $940 million to $960 million for the year. The trend in direct chip sales will also show whether the decline seen in the third quarter continues.

Further detail on the Microsoft agreement would help clarify its scale and its effect on future results. The company has not set out those terms so far. Market participants will also follow how the shares trade when the regular session reopens after the 11% move.