Freedom Capital Markets has lifted Cerebras to Buy from Hold, arguing the recent slide in the shares created the opportunity rather than destroyed it. The AI chipmaker, known for its giant Wafer Scale Engine, went public in mid-May at $185 a share and has traded wildly ever since.

The upgrade lands in the middle of a rough week for the stock. Shares dropped as much as 8.87% on Wednesday, closing near $180.22, after semiconductor research firm SemiAnalysis reported that Nvidia GPUs rather than Cerebras silicon are handling OpenAI's new Ultrafast-tier inference. The report struck at Cerebras's core pitch: back in August, Cerebras had been tapped to power the "Ultrafast" offering, marketed on eight-fold speed gains of roughly 300 tokens a second.

The stakes are high because OpenAI is Cerebras's biggest customer measured by revenue backlog, per Barron's reporting. Neither company has publicly commented on the SemiAnalysis claim, leaving investors to price in the uncertainty. One benign read is that capacity or technical limits, not a lost deal, explain the workload split — and nothing on the record rules out Cerebras powering the tier later.

Why it matters

AI infrastructure stocks have traded on momentum this year, and Cerebras shows what happens when the narrative cracks. The report attacks the company's central technical claim: its Wafer-Scale Engine crams billions of cores and deep memory onto one slab of silicon, dodging the slowdowns of shuffling data across hundreds of GPUs. If Nvidia hardware can now handle top-tier inference at low batch sizes without giving up cost efficiency — long considered Cerebras's home turf — the competitive moat looks narrower. Related reading: IG Group shares crash on guidance cut and more Stocks news.

Freedom Capital's upgrade is a bet that the market overreacted. With the shares down sharply from post-IPO highs, the risk-reward has shifted — in the firm's view — from fair to attractive.

What to watch

  • Any response from Cerebras or OpenAI on the SemiAnalysis report.
  • Whether OpenAI's Ultrafast workloads move back toward Cerebras hardware.
  • The next earnings print: customer concentration and margin trends are the open questions.
  • Broader AI-chip sentiment — Nvidia results and hyperscaler spending guide the whole sector.

MarketRadar take

Neutral-to-bullish near term: an upgrade after an 8%+ slide often finds a floor, and the claim remains unconfirmed. But this is a sentiment call, not a fundamental one — until OpenAI's hardware plans are clarified, the stock stays hostage to Nvidia-versus-challenger headlines.