--- title: "UBS cuts Cerebras target to $155 from $250 as CEO says data-center builds are behind schedule" description: "The beat and the Microsoft logo were Thursday's story. By Friday, UBS had found the $26.1 billion backlog can shrink when data-center shells slip, and the chief executive weighing how to fund the build said it is behind schedule." publisher: "The Inference" section: "Chips" published: 2026-11-14T15:03:16.031Z modified: 2026-11-14T15:03:16.031Z canonical: https://theinference.org/article/ubs-cuts-cerebras-target-to-155-from-250-as-ceo-says-data-center-builds-are-behind-schedule language: en keywords: "Cerebras, OpenAI, AI Chips, Earnings, Data Centers" --- # UBS cuts Cerebras target to $155 from $250 as CEO says data-center builds are behind schedule > The beat and the Microsoft logo were Thursday's story. By Friday, UBS had found the $26.1 billion backlog can shrink when data-center shells slip, and the chief executive weighing how to fund the build said it is behind schedule. ## UBS found the backlog behind the pop can shrink Cerebras rose about 17% after hours on Thursday on a third-quarter beat, a raised outlook and a new cloud customer, [Microsoft](https://theinference.org/markets/companies/microsoft) [1]. The day after brought the harder news. UBS kept its Buy rating but cut its target to $155 from $250, after netting down [OpenAI](https://theinference.org/markets/companies/openai)'s share of the $26.1 billion in remaining performance obligations, the contracted revenue [Cerebras](https://theinference.org/markets/companies/cerebras-systems) has not yet booked, for data-center shell delays that could let OpenAI claim credits [3][4]. Two details from the same day sharpen it. The quarter's core revenue added back $36.4 million of amortization on customer warrants, tied mainly to OpenAI's 33.4 million warrant shares [3]. And [Amazon Web Services](https://theinference.org/markets/companies/amazon), [Oracle](https://theinference.org/markets/companies/oracle) and Microsoft, the logos the diversification story rests on, are not yet in that backlog and bring no revenue, on [The Next Platform](https://www.nextplatform.com/compute/2026/11/14/cerebras-readies-cs-5-systems-for-2027-launch-as-it-bags-another-hyperscaler/5309932)'s reading [5]. On Friday, chief executive Andrew Feldman said [the data-center builds are behind schedule](https://www.cnbc.com/video/2026/11/13/cerebras-ceo-andrew-feldman-on-data-centers-we-are-behind-schedule-on-builds.html) [6]. ## The quarter beat on the adjusted measure, not on GAAP Core revenue, which adds back stock-based pay, warrant amortization and some data-center costs, rose 70% to $230.9 million against the $214.7 million analyst consensus tracked by LSEG; GAAP revenue rose 55% to $210.8 million [1][7]. Core cloud revenue grew 272% to $144.9 million, 63% of core revenue, while hardware fell to $68.9 million from $96.8 million [1][3][8]. Core net income of $29.8 million was the first adjusted profit as a public company; the GAAP net loss widened to $161.2 million [1][3]. *Chart: **The beat was on the core measure: GAAP revenue missed the $214.7M consensus** Bar chart of Cerebras third-quarter core revenue, the analyst consensus and GAAP revenue, in US dollars millions* *Cerebras third-quarter 2026 revenue on its core, or adjusted, basis against the LSEG-tracked analyst consensus and GAAP revenue. US$ millions. The company's core measure adds back stock-based pay, warrant amortization and some data-center costs. Sources: The Next Web; CNBC. [1][7]* ## The guide rose and Microsoft signed in October The 2026 core outlook rose to $940–960 million [from $880–890 million](https://theinference.org/article/cerebras-needs-a-269-million-q4-to-hold-its-880-million-2026-guide), and [the fourth-quarter guide of $310–330 million](https://www.marketscreener.com/news/cerebras-systems-delivers-record-revenue-in-third-quarter-2026-raises-full-year-outlook-ce785ed9d989f02c) cleared the $271 million consensus [7][8]. Microsoft signed in October, with revenue from the first quarter of 2027 and terms undisclosed [1][7]. The run is real: three straight quarters above guidance and a sales pipeline up more than tenfold in the quarter, by the chief financial officer's count [3][8]. ## OpenAI is most of the backlog, and it can claim credits OpenAI makes up [the majority of the $26.1 billion in obligations](https://theinference.org/article/openai-now-decides-what-cerebras-s-wafer-is-worth), chief financial officer Bob Komin [said on the earnings call](https://finance.yahoo.com/markets/stocks/articles/cerebras-soars-15-raised-outlook-143133461.html) [9]. Fourth-quarter cloud revenue is guided roughly flat, the company said, because land, power and construction delays held back early deliveries to OpenAI [9]. UBS's arithmetic gives the slippage a price: when shells arrive late, OpenAI's obligations are netted down and the customer can claim credits, so delay pays OpenAI out of the number investors marked up on Thursday [3][4]. Tripling revenue in 2027, as Feldman promises [8], off the roughly $950 million midpoint of the new guide implies about $2.85 billion, slightly under the $2.92 billion consensus [1][7]. ## Seven hundred megawatts still have to be paid for Cerebras has 700 megawatts of data-center capacity under contract for delivery by the end of 2027, with new sites in Norway and Finland: a contracted figure, not capacity already running [1][2][8]. Nine-month spending ran $1.05 billion on property and equipment against $388.9 million consumed by operations, and it ended September with $7.8 billion in cash and short-term investments plus $850 million of debt capacity [1][8]. The squeeze sits late in the year: about $497 million of capital spending and a $341 million operating outflow in the third quarter alone [10]. *Chart: **Capital spending has outrun operating cash in every reported quarter** Line chart of Cerebras quarterly capital spending against operating cash flow, Q1 2025 to Q3 2026* *Quarterly figures from Cerebras's SEC filings, US$ millions; Q3 and Q4 2025 are not on file in the series. Source: Cerebras quarterly SEC filings. [10]* Feldman told [CNBC](https://www.cnbc.com/2026/11/12/cerebras-systems-cbrs-q3-earnings-report-2026.html) on Friday that Cerebras is weighing financing options to keep up with demand [6][7]. If the next leg of the build is funded with equity, it prices near Friday's close of $108.72 rather than the $185 of the May 14 listing, and the dilution lands below the entry of May's buyers [4][8]. *Chart: **Analyst targets cluster near the $185 IPO price; the shares do not** Bar chart of analyst price targets for Cerebras against its share price and its May 2026 IPO price* *Published targets from Investing.com via Yahoo Finance, November 13, 2026; Nasdaq close from MarketScreener; IPO price from Crypto Briefing. US dollars. [3][4][8]* The next documents decide it: the fourth-quarter report against the $310–330 million guide, whatever financing Feldman has been weighing, and whether Microsoft's revenue starts on time in the first quarter of 2027 [3][7]. ## Takeaway UBS cut its Cerebras target to $155 from $250 after netting OpenAI's share of the $26.1 billion backlog down for late data-center shells, and Andrew Feldman says the builds are behind schedule while capital spending runs far ahead of operating cash. ## Sources 1. [The Next Web, Cerebras raises its 2026 forecast and signs Microsoft as a cloud customer, 13 November 2026](https://thenextweb.com/news/cerebras-microsoft-deal-q3-2026-forecast) 2. [iTMunch, Cerebras Raises 2026 Forecast as Cloud Growth Brings a Microsoft Deal, 13 November 2026](https://itmunch.com/cerebras-raises-2026-forecast-as-cloud-growth-brings-a-microsoft-deal/) 3. [Investing.com via Yahoo Finance, Cerebras earnings analysis: questions answered and next catalysts, 13 November 2026](https://finance.yahoo.com/markets/stocks/articles/cerebras-earnings-analysis-questions-answered-203223446.html) 4. [Crypto Briefing, UBS sticks with Buy on Cerebras at $155 as customer list widens beyond OpenAI, 13 November 2026](https://cryptobriefing.com/ubs-cerebras-buy-155-price-target/) 5. [The Next Platform, Cerebras Readies CS-5 Systems For 2027 Launch As It Bags Another Hyperscaler, 14 November 2026](https://www.nextplatform.com/compute/2026/11/14/cerebras-readies-cs-5-systems-for-2027-launch-as-it-bags-another-hyperscaler/5309932) 6. [CNBC video, Cerebras CEO Andrew Feldman on data centers: 'We are behind schedule' on builds, 13 November 2026](https://www.cnbc.com/video/2026/11/13/cerebras-ceo-andrew-feldman-on-data-centers-we-are-behind-schedule-on-builds.html) 7. [CNBC, Jordan Novet, Cerebras pops after beating on quarterly revenue and announcing Microsoft deal, 12 November 2026](https://www.cnbc.com/2026/11/12/cerebras-systems-cbrs-q3-earnings-report-2026.html) 8. [Cerebras Systems press release via GlobeNewswire/MarketScreener, Cerebras Systems Delivers Record Revenue in Third Quarter 2026, Raises Full-Year Outlook, 12 November 2026](https://www.marketscreener.com/news/cerebras-systems-delivers-record-revenue-in-third-quarter-2026-raises-full-year-outlook-ce785ed9d989f02c) 9. [Yahoo Finance, Cerebras Soars 15% on Raised Outlook and Microsoft Deal, Expects to 'Triple Revenue in 2027', 13 November 2026](https://finance.yahoo.com/markets/stocks/articles/cerebras-soars-15-raised-outlook-143133461.html) 10. [Cerebras Systems, quarterly figures from its SEC filings (EDGAR), retrieved 14 November 2026](https://www.sec.gov/cgi-bin/browse-edgar?action=getcompany&CIK=0002021728) --- UBS cuts Cerebras target to $155 from $250 as CEO says data-center builds are behind schedule — The Inference. Canonical: https://theinference.org/article/ubs-cuts-cerebras-target-to-155-from-250-as-ceo-says-data-center-builds-are-behind-schedule