Why Cerebras Stock Dropped Today

Cerebras Systems (CBRS -6.57%) experienced a 6% drop in its stock price during Friday's trading session, and the primary culprit behind this decline appears to be Intel (INTC -28.97%). Intel announced a strong earnings beat last night, reporting $0.52 per share in earnings compared to the expected $0.40, and $16.5 billion in sales, surpassing Wall Street's expectations.

However, Intel later disclosed that its Q4 earnings may only reach $0.25 per share, with sales no greater than $16 billion, falling short of the $17.1 billion forecast by analysts.

The connection between Intel's earnings report and Cerebras stock can be traced back to the artificial intelligence (AI) sector. Both Intel and Cerebras are viewed as AI stocks, with Intel benefiting from the transition from CPU-driven usage in agentic AI, and Cerebras offering wafer-scale engines capable of addressing both AI compute and memory chip shortages.

As the AI economy appears more robust, both Intel and Cerebras stand to gain. Nonetheless, the health of the AI economy is contingent upon the availability of sufficient AI hardware.

Intel's report revealed a 21% year-over-year revenue growth, with AI revenue for data centers increasing by 78%. Conversely, Intel's Q4 guidance suggests a potential profit decline of over 50%, coupled with a sudden revenue slowdown. Nevertheless, during the earnings call, Intel CFO David Zinsner confirmed that demand for data center and AI products remains significantly higher than the available supply. He also expressed confidence that this demand will persist in Q4 2026, 2027, and 2028.

While Intel's sales are declining due to a drop in personal computer sales, a market that Cerebras does not target, the adverse impact on Cerebras stock seems unlikely. Intel's poor performance does not necessarily translate to a negative outcome for Cerebras stock.