Cerebras Systems reported second-quarter GAAP revenue of $180.1 million against an analyst consensus of $194 million. It also reported a figure it calls core revenue: $209.9 million, which adds back $44.3 million of customer warrant amortization and strips out $14.5 million of pass-through revenue.
Wall Street picked the first number. Shares fell more than 15% before Thursday’s open and finished the session down double digits, even though the company raised full-year guidance and posted a narrower adjusted loss than expected.
What actually changed underneath
The mix moved hard. Cloud and other services carried the quarter at $126.0 million, up 281% year over year. Hardware went the other way, falling to $54.1 million from $70.3 million. That is a business converting from selling systems to renting inference — a real and arguably better model, and a lower-margin one.
The GAAP loss was $450.5 million, or $2.98 a share, driven mostly by $377.0 million of stock compensation. On the company’s own core measure, the net loss was $6.9 million. Remaining performance obligations stand at $25.4 billion, and CFO Bob Komin said Cerebras plans to more than triple revenue in 2027.
Guidance did go up: full-year core revenue of $880 million to $890 million, raised from $855 million to $865 million. But the margin guide went the other way. Third-quarter core gross margin was guided to 38–40% against 40.6% delivered, and core operating margin to negative 25% to negative 23% against negative 16%. More revenue, thinner economics. Wedbush pinned the selloff on expectations, noting the stock had run up sharply into the print — the same mechanism that has punished beat-and-raise prints across software and semis all season.
Our take: When a company needs a second definition of revenue to clear consensus, the definition becomes the story. Core revenue is not fake — warrant amortization is a genuinely non-cash cost of buying anchor customers, and pass-through revenue genuinely is not yours. But it is a number that exists because the reported one is inconvenient, and every quarter the gap persists is a quarter the market gets to decide which one is real. The $25.4 billion of remaining performance obligations is the actual asset here. Converting it while gross margin slides toward 38% is the actual test.
What to watch
- The gap between GAAP and core. $29.8 million this quarter. If it does not shrink, the bridge is structural, not transitional.
- The hardware line. Down 23% year over year. A cloud-first pivot is fine; a collapsing systems business under it is not.
- Stock comp. $377.0 million against $180.1 million of GAAP revenue is a ratio that has to come down.
- RPO conversion. “More than triple in 2027” is a big claim resting on a backlog that has to be delivered, not just signed.