The Rise of AI Tokens and Market Impact
Written by Emily J. Thompson, Senior Investment Analyst
Updated: 9 hours ago
0mins
Source: CNBC
- Token Definition and Use: Tokens are emerging as the new currency in artificial intelligence, becoming fundamental for developers to build applications, with OpenAI and Anthropic frequently referencing them in their IPO filings, highlighting their significance in AI business models.
- Market Competition Landscape: SpaceX and Cerebras extensively discuss the role of tokens in their IPO filings, with Cerebras' chips having a notable advantage in token generation, potentially impacting the market positions of OpenAI and Anthropic.
- Google's Token Usage: Google reported an increase in token processing from 10 billion to 16 billion per minute in its cloud business, indicating a surge in demand for AI services, although the direct correlation between token usage and revenue remains unclear.
- Future Challenges and Opportunities: OpenAI and Anthropic must generate sufficient revenue from token usage to cover hardware and cloud service costs, as their current business models are not yet profitable, presenting significant financial challenges.
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Analyst Views on CBRS
Wall Street analysts forecast CBRS stock price to rise
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About CBRS
Cerebras Systems Inc. is an artificial intelligence (AI) infrastructure company that designs and manufactures an AI compute platform comprised of proprietary systems and software. The Company's products include inference Cloud, Training Cloud, CS-3 system, AI supercomputer, Wafer Scale Engine and model development. The Company's pioneering Wafer-Scale Engine (WSE), a chip encompassing an entire silicon wafer, was specifically designed to enable higher performance and speeds than GPUs for the computational demands of inference, Generative AI (GenAI), and other AI applications. It offers deployment services to assist customers with data preparation, model architecture design, training management, inference optimization, and, in select cases, ongoing system operations and management. It also offers a subscription service providing access to an ongoing stream of software updates and upgrades for purchasers of its hardware.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
Cerebras Shares Rebound as Wall Street Initiates Coverage
- Positive Market Reaction: Cerebras shares rose 5% in premarket trading on Monday, reflecting investor confidence in the newly public chipmaker, particularly after Wall Street initiated coverage, indicating recognition of its unique capabilities.
- Large Financing Scale: Cerebras raised $5.55 billion in its IPO at a price of $185 per share, opening at $350, which, despite subsequent declines, demonstrates strong market demand and investor interest.
- Optimistic Analyst Ratings: Morgan Stanley rated Cerebras as 'Overweight' with a price target of $250, highlighting its unique advantages in AI infrastructure, especially as demand for fast inference grows, positioning the company for significant benefits.
- Significant Collaboration Potential: Needham analysts noted Cerebras' $20 billion compute deal with OpenAI and collaboration with AWS, underscoring its unique position in fast inference workloads and the potential for substantial revenue growth in the future.
See More
SpaceX IPO Approaches: Investors Should Exercise Caution
- Record IPO Size: SpaceX plans to offer approximately 555.6 million shares at a fixed price of $135 each, aiming to raise $75 billion and achieve a valuation of around $1.8 trillion, marking it as one of the largest IPOs in history and reflecting high market expectations for its future potential.
- Revenue vs. Loss: While SpaceX's revenue is projected to grow 33% year-over-year to $18.7 billion by 2025, the company shifted from a modest profit in 2024 to nearly a $5 billion loss last year, highlighting the challenges of its capital-intensive business model, which may impact investor confidence.
- Oversubscription Phenomenon: With IPO orders reportedly around $250 billion, nearly triple the amount the company hopes to raise, this oversubscription could lead investors to overpay on opening day due to feelings of scarcity and speculation, increasing short-term risks.
- Historical Lessons Caution: Analyzing recent tech IPOs reveals that many companies experience significant volatility after their opening day; investors should approach the SpaceX IPO with caution to avoid chasing short-term gains at inflated valuations, and consider waiting for market stabilization before making decisions.
See More
SpaceX Aims for Historic $1.8 Trillion IPO
- Record-Setting IPO: SpaceX plans to issue approximately 555.6 million shares at $135 each, aiming to raise $75 billion and achieve a valuation of nearly $1.8 trillion, highlighting its immense market potential in the aerospace sector.
- Investor Enthusiasm: With IPO orders reportedly around $250 billion, nearly three times the amount the company hopes to raise, this oversubscription could drive opening prices far beyond fundamentals, reflecting strong market demand and speculative sentiment towards SpaceX.
- Profitability Fluctuations: Despite a 33% year-over-year revenue growth to $18.7 billion in 2025, SpaceX shifted from a modest profit in 2024 to a nearly $5 billion loss in 2025, underscoring the challenges of its capital-intensive business model.
- Historical Lessons Caution: Analysis indicates that many tech IPOs experience significant price volatility post-opening, suggesting that investors should approach the SpaceX IPO with caution to avoid potential price declines following an initial surge.
See More
The Rise of AI Tokens and Market Impact
- Token Definition and Use: Tokens are emerging as the new currency in artificial intelligence, becoming fundamental for developers to build applications, with OpenAI and Anthropic frequently referencing them in their IPO filings, highlighting their significance in AI business models.
- Market Competition Landscape: SpaceX and Cerebras extensively discuss the role of tokens in their IPO filings, with Cerebras' chips having a notable advantage in token generation, potentially impacting the market positions of OpenAI and Anthropic.
- Google's Token Usage: Google reported an increase in token processing from 10 billion to 16 billion per minute in its cloud business, indicating a surge in demand for AI services, although the direct correlation between token usage and revenue remains unclear.
- Future Challenges and Opportunities: OpenAI and Anthropic must generate sufficient revenue from token usage to cover hardware and cloud service costs, as their current business models are not yet profitable, presenting significant financial challenges.
See More
SpaceX IPO Set to Break Records
- Record-Setting IPO: SpaceX plans to issue approximately 555.6 million shares at $135 each, aiming to raise $75 billion, which would value the company at about $1.8 trillion, marking the largest IPO in history.
- Nasdaq Rule Changes: In anticipation of SpaceX's debut, Nasdaq revised its inclusion criteria for the Nasdaq-100, eliminating the 10% float requirement and shortening the inclusion timeline to 15 trading days, which will lead to significant stock purchases in the weeks following the IPO.
- Strong Investor Demand: The SpaceX IPO has already been oversubscribed, indicating robust market demand, even though its float represents only 4% of total shares, suggesting that index funds will acquire a substantial portion, artificially inflating the stock price in the short term.
- Insider Selling Risks: SpaceX has implemented a staggered lockup period, allowing insiders to sell shares shortly after the IPO, which could lead to significant price volatility and pose risks for retail investors as they may face a wealth transfer to company insiders.
See More
SpaceX IPO Set to Raise Record $75 Billion
- Record IPO Size: SpaceX is set to go public on June 12, aiming to raise $75 billion, which would make it the largest initial public offering (IPO) in history, reflecting strong market confidence in its future potential with a valuation of approximately $1.8 trillion.
- Low Float Limitation: The IPO will sell approximately 555.6 million shares, representing just over 4% of its outstanding shares, significantly lower than the typical 10% to 20%, which will lead index funds to buy a substantial amount of SpaceX stock in the weeks following its debut, artificially inflating the share price.
- Lockup Period Structure: SpaceX has broken from tradition by implementing a staggered lockup period, where while Musk cannot sell shares for 366 days, other insiders will be able to start selling after the first quarterly report in August, posing a risk of significant wealth transfer from retail investors.
- Financial Performance Concerns: Despite SpaceX's valuation of $1.77 trillion, it reported a net loss of $4.9 billion last year, and its price-to-sales ratio of 95 far exceeds sustainable levels in the industry, prompting investors to be cautious about its future financial performance potentially falling short of expectations.
See More
Cerebras Shares Rebound as Wall Street Initiates Coverage
- Positive Market Reaction: Cerebras shares rose 5% in premarket trading on Monday, reflecting investor confidence in the newly public chipmaker, particularly after Wall Street initiated coverage, indicating recognition of its unique capabilities.
- Large Financing Scale: Cerebras raised $5.55 billion in its IPO at a price of $185 per share, opening at $350, which, despite subsequent declines, demonstrates strong market demand and investor interest.
- Optimistic Analyst Ratings: Morgan Stanley rated Cerebras as 'Overweight' with a price target of $250, highlighting its unique advantages in AI infrastructure, especially as demand for fast inference grows, positioning the company for significant benefits.
- Significant Collaboration Potential: Needham analysts noted Cerebras' $20 billion compute deal with OpenAI and collaboration with AWS, underscoring its unique position in fast inference workloads and the potential for substantial revenue growth in the future.
See More
SpaceX IPO Approaches: Investors Should Exercise Caution
- Record IPO Size: SpaceX plans to offer approximately 555.6 million shares at a fixed price of $135 each, aiming to raise $75 billion and achieve a valuation of around $1.8 trillion, marking it as one of the largest IPOs in history and reflecting high market expectations for its future potential.
- Revenue vs. Loss: While SpaceX's revenue is projected to grow 33% year-over-year to $18.7 billion by 2025, the company shifted from a modest profit in 2024 to nearly a $5 billion loss last year, highlighting the challenges of its capital-intensive business model, which may impact investor confidence.
- Oversubscription Phenomenon: With IPO orders reportedly around $250 billion, nearly triple the amount the company hopes to raise, this oversubscription could lead investors to overpay on opening day due to feelings of scarcity and speculation, increasing short-term risks.
- Historical Lessons Caution: Analyzing recent tech IPOs reveals that many companies experience significant volatility after their opening day; investors should approach the SpaceX IPO with caution to avoid chasing short-term gains at inflated valuations, and consider waiting for market stabilization before making decisions.
See More
SpaceX Aims for Historic $1.8 Trillion IPO
- Record-Setting IPO: SpaceX plans to issue approximately 555.6 million shares at $135 each, aiming to raise $75 billion and achieve a valuation of nearly $1.8 trillion, highlighting its immense market potential in the aerospace sector.
- Investor Enthusiasm: With IPO orders reportedly around $250 billion, nearly three times the amount the company hopes to raise, this oversubscription could drive opening prices far beyond fundamentals, reflecting strong market demand and speculative sentiment towards SpaceX.
- Profitability Fluctuations: Despite a 33% year-over-year revenue growth to $18.7 billion in 2025, SpaceX shifted from a modest profit in 2024 to a nearly $5 billion loss in 2025, underscoring the challenges of its capital-intensive business model.
- Historical Lessons Caution: Analysis indicates that many tech IPOs experience significant price volatility post-opening, suggesting that investors should approach the SpaceX IPO with caution to avoid potential price declines following an initial surge.
See More
The Rise of AI Tokens and Market Impact
- Token Definition and Use: Tokens are emerging as the new currency in artificial intelligence, becoming fundamental for developers to build applications, with OpenAI and Anthropic frequently referencing them in their IPO filings, highlighting their significance in AI business models.
- Market Competition Landscape: SpaceX and Cerebras extensively discuss the role of tokens in their IPO filings, with Cerebras' chips having a notable advantage in token generation, potentially impacting the market positions of OpenAI and Anthropic.
- Google's Token Usage: Google reported an increase in token processing from 10 billion to 16 billion per minute in its cloud business, indicating a surge in demand for AI services, although the direct correlation between token usage and revenue remains unclear.
- Future Challenges and Opportunities: OpenAI and Anthropic must generate sufficient revenue from token usage to cover hardware and cloud service costs, as their current business models are not yet profitable, presenting significant financial challenges.
See More
SpaceX IPO Set to Break Records
- Record-Setting IPO: SpaceX plans to issue approximately 555.6 million shares at $135 each, aiming to raise $75 billion, which would value the company at about $1.8 trillion, marking the largest IPO in history.
- Nasdaq Rule Changes: In anticipation of SpaceX's debut, Nasdaq revised its inclusion criteria for the Nasdaq-100, eliminating the 10% float requirement and shortening the inclusion timeline to 15 trading days, which will lead to significant stock purchases in the weeks following the IPO.
- Strong Investor Demand: The SpaceX IPO has already been oversubscribed, indicating robust market demand, even though its float represents only 4% of total shares, suggesting that index funds will acquire a substantial portion, artificially inflating the stock price in the short term.
- Insider Selling Risks: SpaceX has implemented a staggered lockup period, allowing insiders to sell shares shortly after the IPO, which could lead to significant price volatility and pose risks for retail investors as they may face a wealth transfer to company insiders.
See More
SpaceX IPO Set to Raise Record $75 Billion
- Record IPO Size: SpaceX is set to go public on June 12, aiming to raise $75 billion, which would make it the largest initial public offering (IPO) in history, reflecting strong market confidence in its future potential with a valuation of approximately $1.8 trillion.
- Low Float Limitation: The IPO will sell approximately 555.6 million shares, representing just over 4% of its outstanding shares, significantly lower than the typical 10% to 20%, which will lead index funds to buy a substantial amount of SpaceX stock in the weeks following its debut, artificially inflating the share price.
- Lockup Period Structure: SpaceX has broken from tradition by implementing a staggered lockup period, where while Musk cannot sell shares for 366 days, other insiders will be able to start selling after the first quarterly report in August, posing a risk of significant wealth transfer from retail investors.
- Financial Performance Concerns: Despite SpaceX's valuation of $1.77 trillion, it reported a net loss of $4.9 billion last year, and its price-to-sales ratio of 95 far exceeds sustainable levels in the industry, prompting investors to be cautious about its future financial performance potentially falling short of expectations.
See More
