Cerebras Systems Craters Again, Down Nearly 50% Year-to-Date: 240% Gains to Come According to This Wall Street Analyst
A short report, an insider selling flood, and whispers that its biggest customer jumped ship sent Cerebras crashing below $100. One Wall Street analyst just slapped a Buy on the rubble and sees a path to triple-digit gains.
Cerebras Systems (NASDAQ:CBRS) trades at $96.36. The average Wall Street price target of $282.55 implies 193.2% upside.
Cerebras builds wafer-scale AI chips and runs a cloud service for fast AI inference. Among its customers and partners are AMD (NASDAQ:AMD | AMD Price Prediction) and CrowdStrike (NASDAQ:CRWD): OpenAI, AWS, AMD and CrowdStrike. It raised $6.4B in its IPO and has $25.4B in remaining performance obligations. Craig-Hallum started coverage with a Buy rating and a $325.00 target. That target implies 237.3% upside, the headline’s 240%.
Lockup Expiry, a Short Report and OpenAI Doubts Sent Cerebras Below $100
The biggest single blow came when the post-IPO lockup ended. The stock fell below its $185 IPO price as insiders filed to sell more than $84 million in shares. At the same time, reports questioned whether OpenAI was running its newest fast model on rival hardware. Then Culper Research disclosed a short position and claimed Cerebras chips may last only 1.5 to 2.5 years. Law firms opened investigations, and TD Cowen cut its target from $275 to $175.
Shares lost 42.1% over the past month and 11.74% in the most recent trading day alone. Earlier results set this up. Q2 GAAP revenue of $180.11M came in below the $193.55M consensus, and GAAP EPS of -$2.98 missed the -$0.1801 estimate. Core gross margin slid to 40.6% from 46.5% the quarter before.
Ten of 11 Analysts Still Rate Cerebras a Buy
Wall Street remains bullish. Of the 11 analysts covering the stock, 3 give it a Strong Buy, 7 rate it Buy and 1 rates it Hold. None rate it Sell. The core argument is that the wafer-scale design avoids the parts in shortest supply across the industry: HBM memory, CoWoS packaging and 3nm fabrication. Craig-Hallum points to that architecture as a durable advantage in fast inference.
The growth numbers support the case. Core revenue rose 103% to $209.9 million. Management also raised full-year core revenue guidance to $880 million to $890 million. CEO Andrew Feldman said the company expects to “more than triple our core revenues in ’27.”
Analysts are watching a few specific catalysts. Management expects Q3 to mark the low point for gross margin, with a recovery in Q4 as company-owned systems replace leased ones. The long-term goal is 60% plus. The AWS Trainium offering should reach Bedrock in Q1 2027, and the CS5 system is due in the second half of 2027.
Recent target changes are mostly cuts. UBS lowered its target to $250.00 from a Street-high $330.00, while Wedbush has been at $320.00. Price targets are no guarantee, and the consensus likely trails what has happened to the stock.
AMD and NVIDIA Fell Too, but Cerebras Fell Furthest
AI chip stocks sold off as a group. Cerebras, however, dropped far more than its larger peers. (We reverse-engineered what the biggest chip winners looked like early in a free guide here: The Next Nvidia Playbook.)
AMD (NASDAQ:AMD) lost 26.36% over the past month but is still up 117.99% this year. At $466.84 against a $640.21 target, it has 37.1% implied upside. Of its 55 analysts, 44 rate it Buy or better and 11 rate it Hold.
NVIDIA (NASDAQ:NVDA) fell 13.63% over the month and is up 8.6% this year. At $202.06 against a $328.95 target, it has 62.8% implied upside. 59 of its 62 analysts rate it Buy or better.
Cerebras has by far the largest implied upside in the group. That gap shows analysts’ confidence in the company, and it also shows how much risk the market is pricing in.
Cerebras Is Down Sharply While the S&P 500 Is Up 10%
At $96.36, Cerebras sits below its previous 52-week low of $104.18 and far below its high of $386.34. It is down 69.02% from its first day of trading and 42.1% over the past month. By comparison, the S&P 500 is up 10.29% year to date and down 2.28% for the month.
The 11 analysts covering the stock have an average target of $282.55, or 193.2% upside. The company held $6.74B in cash and equivalents, compared with a market value of roughly $10.82B.
Cerebras Needs to Prove Its Margins Before the Bull Case Holds
The bull case gets stronger if Q4 shows gross margins recovering, OpenAI confirms it is still using Cerebras hardware, and AWS starts adding to the backlog. That is the path back toward $280. The bear case gains weight if the chip lifetime claims hold up, if insider selling continues, or if OpenAI moves its spending elsewhere. OpenAI is a major customer, so losing its business could put part of the $25.4B backlog at risk.
For now, execution is the key variable. The growth is real, and the cash buffer limits the downside. Still, a stock facing a short report, an expired lockup and doubts about its top customer needs one clean earnings report before that triple-digit target looks credible.
Contact [email protected] for any questions or corrections.
Alex Sirois is a financial writer with experience spanning both retail and institutional investing. He has written for InvestorPlace and held roles at BNY Mellon and Bernstein, giving him a perspective that bridges Main Street portfolios and Wall Street analysis.
Alex holds an MBA from George Washington University and has built his career across multiple industries, including e-commerce, education, and translation — a breadth of experience that informs how he breaks down complex financial topics for everyday investors. His writing is conversational, actionable, and grounded in long-term, buy-and-hold investing principles.
At 247 Wall St., Alex focuses on delivering analysis that is both accessible and useful, with a clear emphasis on helping readers make more informed decisions with their money.
