Investors can’t seem to get enough of artificial intelligence infrastructure stocks, and that is pointing to massive demand for semiconductor chip designer Cerebras’ upcoming IPO.
Cerebras, which specializes in chips built to run AI models after they have been trained, looks set to be the biggest IPO so far in 2026 (should OpenAI and SpaceX follow, those are expected to be larger). Cerebras appears on track to raise $4.8 billion after reportedly increasing its target share price range to $150-160 per share from $115-$125. Cerebras is scheduled to price its IPO late Wednesday and for its stock trading to begin Thursday.
At the new price range, the company, which was founded in 2015 and has fewer than 800 employees, would be worth nearly $50 billion. Back in March, when Cerebras filed its IPO paperwork, it had placed a value on itself of $33.6 billion.
“It’s remarkable that the business was valued at $8 billion in October … although large deals with OpenAI and Amazon Web Services certainly help the cause,” says Morningstar senior equity analyst Brian Colello.
Cerebras sits in a sweet spot for the current phase of the AI boom. The major labs, such as OpenAI and Anthropic, are tripping over each other to secure the hardware needed to develop, train, and operate AI technologies.
In the stock market, this has resulted in massive rallies in AI hardware stocks, such as memory drive companies like SanDisk SNDK, whose shares have risen by nearly 4,000% over the past year, and across the semiconductor space. Nvidia NVDA is perhaps the biggest success story among the group, but AI demand has pushed the Morningstar US Semiconductors Index up 124% over the last 12 months and more than 400% over the last three years.
While investors appear likely to snap up shares of the Cerebras IPO, the stock won’t be without risks. The company is competing against the biggest names in the technology industry—including Nvidia. In addition, there are questions about whether key clients like OpenAI will be able to keep up their end of the deals.
A Big Year for IPOs
The heavy demand for the Cerebras IPO comes as investors are awaiting potentially three huge IPOs this year: SpaceX, OpenAI, and Anthropic. SpaceX and OpenAI are expected to raise a combined total of $135 billion in their upcoming listings, according to published reports.
For now, Cerebras will be the largest IPO of the last 12 months, assuming a market cap of $48.8 billion. By proceeds raised, Cerebras’ IPO still trails Medline Industries MDLN, a private equity-backed medical-products company that raised $6.26 billion in its Nasdaq listing in December.
Notably, Cerebras’ IPO beats that of another prominent pure-play AI infrastructure player: CoreWeave CRWV. In CoreWeave’s public debut in March of last year, it raised $1.5 billion at a $23 billion fully diluted market cap. CoreWeave stock is up 162% since its IPO.
What Does Cerebras Do?
Cerebras’ primary business is to design specialized chips for what is known as AI inference workloads, which is the portion of the AI technology process in which companies run live AI models with which users interact (versus the stage where underlying AI models are created and trained).
Cerebras’ products are unique, Colello says, because of the company’s distinct chip-building process. “Typically, larger wafers and chips are difficult to build in high quality because of the risk of higher flaws (and lower yields),” he says. “Cerebras’ ‘fault-tolerant’ architecture allows the wafer to route around these flaws and deliver excellent performance.”
Its products also employ a different kind of memory structure, known as SRAM memory, that Colello says allows for faster queries from AI users. “Cerebras’ deals with OpenAI and [Amazon] suggest that it has found a home in workloads that require speedy response times,” he says.
Cerebras is well-positioned for a growing emphasis in inference workloads, says Dimitri Zabelin, a senior investment research analyst covering AI and cybersecurity companies for PitchBook, a Morningstar company. “The AI market itself shifted in Cerebras’ favor,” he says. “The AI hardware market rotated from training-cycle dominance toward inference-cycle scaling, where token generation speed and cost per query determine competitive positioning.”
Cerebras and Sovereign AI Programs
In 2025, 86% of Cerebras’ revenue came from two companies in the United Arab Emirates. That included a 2024 deal that the company signed with Abu Dhabi tech company G42 to sell its preferred shares. But in 2025, that deal came under US national security scrutiny, which played a part in Cerebras delaying plans for an IPO last year.
That UAE involvement, Zabelin says, has recently turned into a tailwind for Cerebras’ IPO prospects. “As countries complete the initial training of their national models, their focus is pivoting to deploying inference-focused hardware,” he says. “That in turn is expected—and already is—triggering a massive procurement cycle for inference-optimized infrastructure underwritten by state capital. Cerebras is well-positioned to benefit.”
“Fundamentally, Cerebras evolved from a concentrated hardware vendor with some regulatory risk to a diversified infrastructure player positioned at the center of two converging tailwinds: the sovereign AI buildout and the incoming inference tsunami,” Zabelin says.
A Highly Competitive Market
Cerebras isn’t the only company fighting it out in this space. “Nvidia’s Groq business unit is likely Cerebras’ fiercest rival, since both are attacking AI inference using smaller but faster SRAM memory instead of traditional high bandwidth memory,” Colello says.
While there remain opportunities to be had for Cerebras, Colello says the company offers essentially a niche product in a highly competitive space. “Cerebras’ rivals are the large AI accelerator chipmakers like Nvidia and AMD, plus the custom chips designed by Google, AWS, Microsoft, Meta, and others, plus the chip design firms that aid the hyperscalers like Broadcom, Marvell, and MediaTek,” he says. “We anticipate plenty of competition in AI inference over time.”
Investors should also be aware of the arrangements known as “circular deals” with clients. The OpenAI deal came as part of a $20-billion arrangement that took the form of a commitment to buy billions of dollars of Cerebras’ chips in exchange for a stake in the company and a $1 billion loan. A potential risk for the stock is that OpenAI fails to meet its own revenue targets and scales back the need to buy Cerebras’ chips.
Ahead of IPOs, AI Giants Keep Making Circular Deals. Here’s Why That’s a Risk
OpenAI Missed Multiple Revenue Targets—Here’s Why It Likely Won’t IPO This Year
“It’s safe to assume that the OpenAI deal is critical to Cerebras’ valuation,” Colello says. At the same time, “It makes sense for OpenAI to take a piece of the action with its warrants.”
Stepping back, “We suspect that the greatest risk for Cerebras investors would be intense competition in AI inference, especially versus market leader Nvidia and its Groq business unit,” Colello says. “Customer concentration would be another, especially since OpenAI has made large chip deals and will need to continue to grow to justify such deals.”
