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Cerebras Systems warns of sharp Q2 margin drop, raising concerns over cloud business viability.

Company Fundamentals
24 Jun 2026
Seeking Alpha
View Source
Bearish
pluang ai news

Cerebras Systems Inc. reported a surprising guidance for Q2 with gross margins expected to fall to 36%-38% from 46.5% in Q1, and operating margins dropping dramatically from near zero to negative 30%-32%. This 29-point decline in operating margin signals significant challenges in the cloud business, causing investor caution. The company’s valuation at 49 times forward sales demands stronger margins rather than just future plans. Investors remain cautious until Cerebras can operate its cloud business on its own infrastructure, with current guidance raising doubts about near-term profitability.

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