Cerebras Goes Public in Year's Biggest IPO

0:00The right technology can strengthen human judgment. That's why Deloitte brings together AI and data analytics with multidisciplinary teams who can help you connect the dots across your enterprise. From risk to operations to customer needs. So opportunities don't slip by and surprises don't spread. Because the smarter your systems, the sharper your instincts. That's how technology makes people better at what they do best. Deloitte. Together makes progress. Learn more at Deloitte.com slash Together Makes Progress.

0:58The Chase Mobile app is available for select mobile devices. Message and data rates may apply. JPMorgan Chase Bank, N.A. Member FDIC. Copyright 2026. JPMorgan Chase and Company. When you're running a business, the best days are the ones where priorities stay on track. For midsize and large companies, risk can affect multiple parts of the organization at once, from property and liability to cyber and regulatory challenges. At that level, managing risk becomes an ongoing discipline. At the Hartford, the focus is on helping businesses manage risk before it turns into something more disruptive. And when losses do happen, that work is paired with insurance coverage shaped by years of underwriting, risk engineering and claims experience.

1:41Learn more at the Hartford dot com slash risk mitigation. Policies provided by Hartford Fire Insurance Company and its property and casualty affiliates, Hartford, Connecticut. Bloomberg Audio Studios. Podcasts, radio, news.

2:03Bloomberg Tech is live from coast to coast with Caroline Hyde in New York and Ed Ludlow in San Francisco.

2:13Caroline Hyde:This is Bloomberg Tech coming up. Cisco shares jumped the most since 2011 of the company's earnings results. We'll break them down. Plus, China's Xi Jinping gives a warning to President Trump on Taiwan, but tells US tech CEOs China will open up more. And AI chipmaker Cerebris raises$5.55 billion in its US IPO, seizing on the surging demand for semiconductors. We'll be joined by the CEO later this hour. Cisco is our top story, and it is actually rising with the rest of the market. We're up 15 % on track for our biggest jump since 2011. After the open, we hit 17%, putting Cisco on track for its best day since 2002.

2:56Caroline Hyde:It's a pretty simple story. Hyperscalar demand. Calendar year, 26,$9 billion, up from a previous forecast of$5 billion. $4 billion of that will translate into actual revenue, sales, on the income statement in this year. There are many more threads, but Cisco is finding its place in this AI infrastructure story. Let's get out to Bloomberg Equities reporter Ryan Vlaselica. I think, Ryan, the best place to start is what has the sell side reaction been to this? What are the analysts saying the main thread of their enthusiasm for Cisco has been this morning? Analysts are very positive and very optimistic that Cisco will be able to continue kind of putting up these numbers that we saw this past quarter.

3:41There is a lot of optimism that Cisco is now really part of the AI infrastructure firmament. firmament. It showed very strong demand, as you said, from the hyperscalers. It's pointing to very strong growth going forward. I think there's been a growing realization this year that the sort of optical and networking companies are a huge part of the whole data center build out. And obviously, we have seen no end of demand and growth for data centers related to AI. And Cisco is really well positioned in that. It's a legacy company. It has a wide product suite that people are using here. It seems very well positioned and it does seem like analysts are really sort of seeing additional confirmation of this trend.

4:26Caroline Hyde:Ryan, there's so much to pack into Bloomberg Tech today. People are saying, why are you starting on Cisco? The markets team is looking at the equities market widely and Cisco is a big factor in kind of the feel good that's out there. Networking is your cables, your switches, your routers. That all goes into real data centers, right. But the other part of the story is Cisco's discipline. They're cutting about 4 ,000 roles. How did the company kind of spin that as a positive in that sort of feel good around AI in the market today? Well, they talked about how they are really focusing and prioritizing AI.

5:03You mentioned the job cuts. It does seem like all of their investments are really geared toward this in market in particular. So there is a lot of optimism about that. And I would just say, As I'm sure you remember, Cisco was one of the major companies of the dot-com era build-out. Now, it saw huge growth at that time, and it only recently surpassed its dot-com era high. So there's a certain amount of poetic justice, I guess, in the fact that AI is a thing that is finally bringing it back to record levels. It does seem like it is now becoming a real part of this technology build-out, just as it was in the internet tech build-out.

5:37Caroline Hyde:Ryan, you and I were not doing this in the dot-com era, but in the here and now, Cisco is a big story. Bloomberg's Ryan Vlaselica on the equities desk. Thank you so much. Another stock we're watching is Klarna. Looking at shares, also up 15%, 16%. The company posted just$1 million in first quarter net income, but it beat estimates, swinging from a$99 million loss a year ago. This is in the fintech space, right? Revenue jumping 44 % to$1 billion driven by higher interest income, growth in debit card signups, partnership fees. It's another one that we had to fit in in a very busy Thursday morning.

6:11Caroline Hyde:Today, all eyes are on Cerebrus. The company set to begin trading after pricing its IPO at$185 a share, raising$5.55 billion, the biggest US IPO of the year so far. It has been mayhem in the market so far. Shares were indicated at one point to open at$400 a share. $400 having priced at$185. I think we're now back down at$350 a share as of one minute past 8 Pacific time, one minute past 11 a.m. Eastern time. time Bloomberg's Bailey Lipscholz has been my partner in tracking the chaos of this IPO for a good few days now. Let's start with the math. Yeah. The indicated opening price well beyond$185 a share.

6:57Caroline Hyde:What's that telling us? It tells us that there's untapped demand. And when you look at a deal like this more than 20 times oversubscribed, we reported before it even launched, there was$10 billion of demand. So these are huge numbers. This is the hottest stock, at least from an IPO perspective this year, bar none. The big question that you asked me, you know, look at the market cap of where this could open. If we're getting closer to$80 billion, talking to folks on the buy side, they're still saying, you know, if NVIDIA is worth $5 trillion, who's to say that this company doesn't easily trade closer to$100 billion?

7:26I don't know what you've been hearing about that from your side, though.

7:29Caroline Hyde:Yeah, so exactly. That brings us back to like, what is Cerebris? What does it do? Well, it is a full stack, vertically integrated a supercomputer maker, right? NVIDIA makes largely the chips that the server trades these days. It doesn't build its own servers. Dell does that. Supermicro does that. Cerebrus does the full send package. But even at$100 billion, it's a drop in the ocean. Why is the market so enthusiastic about its technology? Like, what else do we know about this company's financials or its customer backlog? The big thing initially when they tried to go public two years ago was concentration risk.

8:02So G42 was pretty much their only customer. They've expanded that. Now you have OpenAI and others in the big pitch. And at least when I talk to folks on the buy side is how broad base can that be? If we're dealing with a market, especially as it relates to building some of the compute and everything that goes into building out the AI future. If this is just the start and we're in early innings, what does this ultimately look like? Call it five years from now. And the big question is, back to your point earlier, if this is just a drop in the bucket, there's a pretty much massive potential as it relates to going forward though again all things considered we've seen semi-conductor index up what 30 percent since they started this

8:42Caroline Hyde:process i would say indicated opening prices they're on the bloomberg terminal they're not always right who knows what will happen when trade starts with bloomberg's beta lip schultz please don't go far stay with bloomberg tech because coming up later this hour we will speak with Cerebra's CEO, Andrew Feldman. And if you're on the socials, hit me up. I welcome your questions. Now, coming up, China's Xi Jinping gives a warning to President Trump on Taiwan. We're going to have those details next. This is Bloomberg Tech.

9:22One of the most important summits and human history. And the two presidents, President Xi and President Trump, have such a wonderful relationship. This is an incredible opportunity for us to rely on the relationships to build a much, much better partnership. Did you get any specific customers for your chips for the H200? We didn't really talk about it. I'm here to support the president and to represent the United States.

9:51Caroline Hyde:That was NVIDIA CEO Jensen Wang speaking to reporters in Beijing and telling Bloomberg the company hasn't really discussed the H200 chips during the president's trips to China. He's there to support President Trump. What was discussed, though, is Taiwan. Xi Jinping, through state news agency, calling it, quote, highly dangerous situation for the world's biggest economies. Let's get out to Bloomberg's Tyler Kendall, who joins us from Beijing. There are many threads. We also have the breaking news of the last 15 minutes, the president saying that Iran was discussed and that there is some sort of agreement there.

10:26Caroline Hyde:What do we need to know? What's the latest from China? Well, Ed, at this point, as you're saying, there are a lot of different threads that we could pull on here. I can't say that the overarching theme appears to be that the efforts here in Beijing are aimed at stabilizing ties between the U.S. and China rather than overhauling them. If we start with the latest news, President Trump out saying that Xi Jinping has pledged not to supply Iran with any weapons and that it's going to help get Iran to the negotiating table. Perhaps this will help make some progress when it comes to what has been gridlock in those ongoing discussions, as well as a reopening in the Strait of Hormuz.

11:05though we would be remiss if we didn't point out that from the Chinese readout, we didn't really get any indications that China is willing to go further in terms of helping to ease that conflict, saying instead that they had extensive dialogue about the situation in the Middle East, but not really giving us any firmer details there. Another point where there appeared to be a mismatch in terms of the public readouts from what happened behind closed doors was, as you mentioned, that issue related to Taiwan. as Chinese President Xi Jinping basically threatened that Taiwan could derail the U.S.-China relationship.

11:40That was not mentioned when it came to the U.S. readout in this. And in fact, we just heard from Secretary of State Marco Rubio, who appeared to downplay that the concerns were raised after we really saw U.S. officials in recent days signal that there would not be a change when it comes to U.S. policy regarding Taiwan. Now, we can say, though, that there was a more optimistic tone reached when it came to the economic issues, including the fact that Chinese President Xi Jinping did appear to signal a move towards greater openness, telling tech execs in the room, including Elon Musk, Tim Cook, Jensen Wang, who traveled with President Trump, in part, quote, that China's door to the outside world will only open wider.

12:21Though, despite the messaging, we haven't really seen tangible signs yet that any steps have been taken. But Chinese state media did report that these executives told Xi Jinping directly that they highly value the Chinese market. And, Ed, as you well know, this U.S. business delegation includes these companies that already have high exposure to the Chinese market, but also companies like Micron, which have seen some of their products barred over cybersecurity concerns here in China. We can't say at this point there's still a lot that we are waiting for, potential purchase agreements when it comes to agriculture, Boeing aircraft or energy products from the U.S.

12:57But the dialogue does continue. These pair of leaders do have bilateral meetings going into tomorrow as well.

13:05Caroline Hyde:Bloomberg's Tyler Kendall with everything you need to know out of China so far in the meeting between President Trump and China's Xi Jinping. Thank you very much. And let's get the broader picture with Michelle Geiler, CEO of the Crack Institute for Tech Diplomacy at Purdue, also served as Assistant Secretary of State for Global Public Affairs under the first Trump administration. You understand how this works and you understand what's at stake. And like here on Bloomberg Tech, right, I want to start with Taiwan because for a very long time you've been coming on this program. And we've been talking about Taiwan in the context of America's dependence on that nation for semiconductor supply.

13:42Caroline Hyde:I'm literally talking about TSMC and the manufacturing footprint in Taiwan. Have we learned anything new here on Taiwan? What did you make of President Xi's statement, I suppose, through the state agency? Nothing's new here. I think the position that China has taken on Taiwan being really important to them when it comes to U.S.-China relations has been the case for quite some time. We know that General Secretary Xi Jinping has been pressuring the president on arms sales to Taiwan for a while. So that's not new at all. And neither is the United States' position on maintaining the status quo. As Secretary Rubio said, there's been no change on the U.S.

14:20position here with regards to Taiwan. But as you had mentioned, the ties between Taiwan and the United States are strong. They run deep. Semiconductors are a critical piece of that. And there's been a lot of collaboration with TSMC building out here in the United States increasingly more over time. And I think ultimately the status quo hasn't changed.

14:41Caroline Hyde:A red headline on the Bloomberg terminal just before we came on air. President Trump saying that President Xi offered help on Iran and pledged not to send weapons to Iran. The president has said that it wouldn't be an important topic of conversation. but actually if you look at like what markets are saying and what people are saying on socials it's a key issue particularly on how it would have a bearing on the street of Hormuz. It's been one of several key issues. I think it's not surprising that they talked about Iran. It was looming over this entire 36-hour summit. The fact that you had mentioned this breaking news that President Xi is going to stop supporting the Iranian regime is a positive step and I think one that the United States would welcome.

15:26So again, not surprising. And I think overall, the big picture on this is, you know, this is a 36-hour summit and on all of these agenda items and ultimately micro-movements in a much bigger picture here of the United States in its long-term view to achieve the golden age of America and retain our leadership across the world. And China is on its own path to China rejuvenation. And the big question is who gets there first? And did the 36 hours in this summit help the United States move incrementally faster toward our vision?

15:57Caroline Hyde:I just want to disclose to the Bloomberg Tech audience that President Trump, in those comments about Iran and President Xi's commitment for Iran, that was part of a Fox News interview, a clip that Bloomberg reviewed. Michelle, would you kindly draw on your experience from participating in the first Trump administration? What does it take to put a delegation like this together that includes Elon Musk, Jensen Wong, picking them up in Alaska for the refuel stop on Air Force One and taking the world's most important tech CEOs to China as part of a high-stakes meeting between President Trump and President Xi?

16:33Yeah, these things take a lot of preparation historically, and especially in terms of what you want the meetings to be about, the readouts coming out of these meetings. However, I will say this. This type of delegation is unprecedented. And I think if you look at how the president has been agile and maybe non-traditional in his work, so are these tech CEOs. They move fast and they're disruptive and it's easy to hop on a plane in Alaska and go to China. So I'd say, you know, there's a lot of planning at the same time with this administration, with these types of disruptive tech leaders. There's also a lot of room for ad-libbing and improvisation.

17:10And I think that's what we're seeing here.

17:13Caroline Hyde:Michelle Goida, CEO of the Crack Institute for Tech Diplomacy at Purdue. Thank you very much. Now, coming up, we're going to get out to Napa Valley for our own Caroline Hyde, set to speak with the CEO of Ericsson on the sidelines of the Spark Global Leadership Summit. It's coming up next. This is Bloomberg Tech.

17:37Caroline Hyde:Nuclear power is trying to make a comeback, But the resources required are in short supply. From uranium mining to enrichment, the supply chain is being reshaped by geopolitics, lobbyists, rising energy demand, new technologies. That's the focus of Bloomberg Primer this week. Listen to this. Global investment in nuclear energy since 2020 is estimated to be around$300 billion, with ambitious plans in Europe, North America and Asia to revive or kickstart their nuclear energy sectors. Every step of the supply chain, from mining to enrichment to building reactors, is highly regulated and controlled.

18:14Because a single misstep could be catastrophic and erode the public trust nuclear has worked decades to regain. It's a real shift from when I came of age and everyone was worried about nuclear war. Because the process of enriching uranium for nuclear fuel,

18:32Caroline Hyde:same technology that they use for enriching uranium to make nuclear weapons. Catch the full episode of Primer on Bloomberg.com and YouTube. Let's get over to the Spark Global Leadership Summit in Napa, where our own Caroline Hyde is standing by. Caro. It is a tough life being hosted by Concello here in Napa Valley. And I'm very pleased to say I'm joined by a giant in telecoms. Based in Sweden, Ericsson is a global company, and Bori Erkom is here with me, who is the CEO. right tell me about the china exposure you have you have supply chain there you have consumer and competition is really what you have from china what did you make of the relationship between us and china that we just saw overnight thanks for having me that's a great question to ask very hard to answer actually we like to do that journalism no i know i know but i i think China started out, as I often look at the old telecom movie from China, it actually started out as being a prioritized sector in China.

19:35So they had almost 100 vendors, if you go back 30 years. They consolidated into really two that became fierce competitors in over a decade. Huawei being one key one. Huawei, of course, being the biggest. And they started out being, of course, low cost and fairly simple. Today, they're, of course, a phenomenal competitor. And it's the one that we benchmark ourselves with and say that's the one we need to beat, actually. We need to win on technology. We need to win on cost position. So for us, the competition with China is front and center and has been. And I do believe that for the rest of the world to compete with China, you need to lead on technology.

20:21But you've been outspoken in the past, sort of pushing against this idea of sort of a focus on your own country and banning in Sweden. They pushed out Chinese competition. And you actually at the time said that's the wrong thing to do. In the U.S., that is your key markets now are the U.S., the Japan, there are other nations. How do you think about China being excluded and should they be? You know, the way to think about China is actually it's multi-prone. So if you take telecom again, it's a scale game. They have scale in their domestic market. That's a market you need to be in. But more importantly, what was also clear is that given the development in China economically and use case wise, you saw data consumption grow much faster in China than anywhere else in the world.

21:10that led them to lead on or demanding certain technologies ahead of the rest of the world. So unless you're on the same development curve as they are in China, we're not going to be able to bring those solutions globally. So if we take in our case, we have what's called massive MIMO. Basically, it's a way to increase capacity in the radio network. They needed that earlier than in the rest of the world. And therefore, if you're not there when that happens, you don't develop the technologies at the same pace as they do in China. So I think it's a much more interdependent world. You need to think of the world as being interdependent.

21:55And you're dependent on geopolitics, tariffs, inflationary pressures, the Strait of Hormuz again front and center today. How are you managing that? You know, we actually took a decision a number of years ago now to say that we have three home markets. So that was recognizing the US because it's a front-runner market. Big India in those days was big. Today it's starting also to be front-runner on technology. Japan, Japan is very big in telecom and also an early adopter of telecom. So we said that's markets we need to win in to make sure that we combat the scale of China. So we did that. Then we said we need a flexible supply chain in order to manage any disturbances.

22:42So we built a factory here in the U.S. How big is your manufacturing now here in the U.S.? We manufacture a large portion of what's supplied to the U.S. is manufactured here in the U.S. So we built that in 20, commissioned it about 2020. So we were ahead of the really supply constraints in that sense and the tariff issues. So we've been able to use that manufacturing footprint, R &D footprint, to actually manage a bit of the geopolitical exposure. Now we look at the markets today and extraordinary ramp higher on the back of AI. AI is the excitement in your area as well. Look, you've got competition with Nokia who has got a strong relation with NVIDIA.