OpenAI is placing a substantial bet on Nvidia (NVDA) rival Cerebras Systems, inking a deal to procure 750 megawatts of computing power through 2028. While the financial terms weren't disclosed, sources familiar with the matter suggest the agreement could exceed $10 billion in value.

The partnership isn't entirely new territory for the two companies. They've already been working together on deploying OpenAI's gpt-oss open-weight models on Cerebras hardware, alongside chips from Nvidia Corp (NVDA) and Advanced Micro Devices (AMD). This latest deal simply takes things to another level.

For Cerebras, landing OpenAI as a major customer is something of a lifeline. The company had become uncomfortably dependent on G42, a UAE-based firm that accounted for a staggering 87% of Cerebras' revenue in the first half of 2024. That's the kind of customer concentration that keeps CFOs up at night.

Cerebras co-founder and CEO Andrew Feldman summed up the company's growth strategy simply: "The way to build three very large customers is to start with one, keep them happy, and then win the second." Fair enough.

IPO Uncertainty and Funding Plans

Cerebras had shelved its IPO plans back in October, despite reaching an $8 billion valuation. The company offered minimal explanation at the time, stating only that it wasn't moving forward "at this time." However, prediction market traders on Kalshi are betting that an IPO announcement could still come before next year.

More recently, reports emerged that Cerebras is pursuing roughly $1 billion in funding at a pre-money valuation of $22 billion. That's a significant jump from the $8 billion valuation discussed during its IPO considerations.

Meanwhile, OpenAI continues expanding its reach across industries. The company recently acquired healthcare technology startup Torch, signaling its ambition to deploy AI solutions beyond its core products. Earlier this month, SB Energy, part of SoftBank Group, partnered with OpenAI to develop and execute data center campus projects.

Both OpenAI and Cerebras declined to comment on the partnership details.