On June 24, Cerebras Systems declined 11.79% overnight, trading at $199.8/share, with turnover of $338,500. The sell-off followed the company's first quarterly earnings report since its IPO in May.

Q1 revenue came in at $193.4 million, up 94% year-over-year and ahead of the $181.2 million consensus estimate. Non-GAAP EPS of -$0.04 also beat expectations of -$0.16. However, the company guided Q2 core gross margin at just 36% to 38%, significantly below industry leader NVIDIA, triggering concentrated selling as investors questioned the commercial profitability of its AI chip business.

Despite strong top-line momentum — including full-year revenue guidance of $855-$865 million versus analyst forecasts of $828 million and CEO confirmation that OpenAI's GPT-5.4 is running on Cerebras hardware — the margin shortfall dominated sentiment. Profit-taking accelerated as the gap between revenue growth and margin reality became apparent, with investors reassessing the path to sustainable earnings for the NVIDIA challenger.

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