Cerebras Systems has signed Microsoft as a cloud customer, making the software giant its third hyperscaler deal after Amazon Web Services and Oracle, as the wafer-scale chipmaker reported a record third quarter and raised its outlook for the full year.
Chief Executive Andrew Feldman disclosed the Microsoft agreement during the company's third-quarter earnings call on November 12, 2026, saying the deal was signed in October. Cerebras expects revenue from Microsoft to begin in the first quarter of 2027, with more details to come next year. The company did not disclose the size or terms. Its release described the win only as a cloud deal with a top-three hyperscaler, and Feldman named Microsoft. Oracle plans to offer Cerebras inference through Oracle Cloud Infrastructure in 2027.
The results behind the announcement were strong. For the quarter ended September 30, 2026, Cerebras reported core revenue of $230.9 million, up 70 percent from $135.7 million a year earlier and above both analyst expectations of $214.7 million and the company's own guidance of $214 million to $216 million. Revenue under standard accounting rules was $210.8 million, up 55 percent. AI cloud services accounted for about $145 million of the core total, while core hardware revenue was $86 million and does not yet include the Oracle deal.
Cerebras raised its full-year 2026 core revenue outlook to $940 million to $960 million, up from $880 million to $890 million previously, and guided fourth-quarter core revenue to between $310 million and $330 million. Gross margins were 41 percent in the third quarter, and the company expects about 48 percent next quarter. Core net income turned positive at $30 million. Feldman said the company expects to triple its revenue in 2027, a target that depends heavily on new data center capacity actually coming online.
Capacity, not demand, is the constraint. Remaining performance obligations, the contracted backlog not yet counted as revenue, reached $26.1 billion as of September 30, and that figure excludes both the Oracle and Microsoft deals. Cerebras says it has 700 megawatts of data center capacity under contract for delivery by the end of 2027, but it expects cloud revenue to stay relatively flat in the fourth quarter because new capacity only begins ramping in December, with larger portions due in mid-2027.
That shortage is reshaping where Cerebras builds. Feldman told investors that more than 75 percent of the company's planned 2027 data center capacity is outside the United States, with sites in Canada, France, and Norway expected to come online in the coming months. During the quarter Cerebras signed contracts for additional capacity in Norway and Finland, and it is in the final stages of contracting for a data center in Sao Paulo, its first in South America.
The company was also candid about strain in its largest partnership. Feldman conceded that Cerebras lacked sufficient capacity to support a broad rollout of OpenAI's Ultrafast service tier and is running behind schedule on the initial capacity deliveries under that agreement. If delays exceed 90 days, either party can cancel that portion of the contract. Cerebras estimates about 5 percent of the contract value may be subject to that condition, and no cancellations have been made.
Investors focused on the wins, and shares rose sharply in extended trading. Landing three major cloud providers in about six months carries weight even though the newest deal produces no revenue until next year. The test now is delivery: converting a $26.1 billion backlog into running capacity, on schedule, across several continents.
Photo: Microsoft Data Center in Middenmeer, the Netherlands, by Hay Kranen, licensed under CC BY 4.0 via Wikimedia Commons.