The artificial intelligence (AI) sector is still recovering from recent setbacks as Nvidia (NASDAQ:NVDA) fights to make up the ground it has lost over the past month. However, investors searching for the next AI breakout may soon have a new stock to watch.
Cerebras Systems, a cutting edge AI startup that produces computer systems for deep learning applications, has filed for an initial public offering (IPO). Indeed, on June 20, The Information reported that the company had filed confidentially for an IPO. While the outlet’s source did not provide much information, they noted that the Cerebras IPO would likely happen later this year. But just over a month later, Cerebras is preparing to start trading and investors have one pressing question: Will this be the next Nvidia?
Holger Mueller of Constellation Research provided context on what the Cerebras IPO could mean for Nvidia:
“With Nvidia just becoming the most valuable publicly traded company on the planet, it’s ironic that the competition is stepping up at around exactly the same time, and it’s not only coming from its traditional rivals in the chip industry […] Cerebras can be a potential competitor to Nvidia that offers a differentiated approach to the way it builds and sells its chips, and it seems likely to attract the funding it needs to become a player in the AI chip race.”
What else do investors need to know about Nvidia’s new competition as it gears up to go public? Many key details have yet to be released yet, but let’s take a closer look at Cerebras and the red hot AI market.
Is Cerebras the Next Nvidia? What to Know.
- Many key details are still being established regarding the Cerebras IPO. According to a statement released by the company today, “the size and price range for the proposed offering have yet to be determined.”
- Founded in 2016, Cerebras has over 350 employees worldwide.
- The company is based in Sunnyvale, California but has additional offices in San Diego, Toronto and Tokyo.
- The AI startup has been backed by many prominent venture capital firms, including Alpha Wave Ventures, Altimeter Capital and Benchmark Capital. Other investors include OpenAI founder Sam Altman and Sun Microsystems co-founder Andy Bechtolsheim.
- SiliconAngle reports that Cerebras’ “WSE-3 chip is expected to become available later this year” and is “built on an advanced five-nanometer process and features 1.4 trillion transistors more than its predecessor chip, with more than 900,000 compute cores and 44 gigabytes of onboard static random-access memory.”
- Cerebras co-founder and CEO Andrew Feldman is a veteran of Silicon Valley. Advanced Micro Devices (NASDAQ:AMD) acquired Feldman’s previous company, SeaMicro, back in 2012 for $334 million.
- As noted, Cerebras filed confidentially for its IPO. According to Reuters, this allows companies to avoid releasing key financial details “for as long as possible.”
On the date of publication, Samuel O’Brient held a LONG position in NVDA. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
On the date of publication, the responsible editor did not have (either directly or indirectly) any positions in the securities mentioned in this article.
