Cerebras Systems, an AI chip startup based in Sunnyvale, California, has filed for an initial public offering (IPO) on the Nasdaq under the ticker symbol "CBRS." The company, founded in 2016 by Andrew Feldman and other industry veterans, has emerged as a key competitor to Nvidia in the AI chip market. The IPO, managed by Citigroup, Barclays, and other underwriters, values the company at approximately $4.1 billion.

Cerebras is best known for developing the Wafer Scale Engine (WSE), the world’s largest AI chip. The latest iteration, the WSE-3, launched in March 2024, features 4 trillion transistors, 900,000 AI cores, and 44GB of on-chip SRAM, offering double the performance of its predecessor, the WSE-2, while maintaining the same power consumption. Built using TSMC’s 5nm process, the WSE-3 is capable of delivering 125 PetaFLOPS, making it ideal for training massive AI models, such as GPT-3.

Cerebras' chips are already deployed in leading institutions like Argonne National Laboratory, Lawrence Livermore National Laboratory, and pharmaceutical giant GlaxoSmithKline. The company has also partnered with the Mayo Clinic to explore the use of its technology in healthcare applications.

Financially, Cerebras is growing rapidly, but like many tech startups, it is not yet profitable. For the first six months of 2024, the company reported a net loss of $66.6 million on $136.4 million in revenue. This marked a significant improvement from the same period in 2023, when it posted a net loss of $77.8 million on just $8.7 million in sales. For the full year of 2023, the company had a net loss of $127.2 million on $78.7 million in revenue.

One of Cerebras' biggest customers is Group 42, a UAE-based AI firm, which accounted for 83% of the company’s revenue in 2023. Group 42 has committed to purchasing $1.43 billion worth of Cerebras products by March 2025, further boosting the company's sales outlook.

The AI chip market is becoming increasingly competitive, with tech giants like Amazon, Google, and Microsoft developing their own AI chips. Cerebras also faces direct competition from Nvidia, AMD, and Intel. Nonetheless, the company sees significant interest in its unique chip technology, with a backlog of orders from various industries, including enterprise, government, and public cloud providers.

As Cerebras gears up for its IPO, it continues to innovate, focusing on reducing the complexity of training large AI models. For example, the company claims that training a GPT-3-sized model on its platform requires 97% fewer lines of code compared to GPU-based systems, significantly simplifying the process for developers.

Despite challenges in the AI hardware market, Cerebras remains confident in its long-term prospects, citing strong demand for its cutting-edge AI chips and partnerships with key institutions.