CoreWeave and Circle Boomed After IPOs. These 3 Companies Could Be Next.

Circle has risen more than fivefold since its initial public offering on June 5. (NYSE)

The market is excited about initial public offerings again.

After the strong performances of recently floated stablecoin company Circle and cloud-rental company CoreWeave, it’s worth casting an eye over the next candidates for an IPO, especially in the technology sector.

There are three major tech companies which could make waves when and if they go public, Figma, Cerebras Systems and Databricks.

Healthy returns aren’t guaranteed —newly public companies often drop back after their lockup periods expire, typically six months from the listing date, allowing insiders and early investors to unload their stock. Still, it’s worth thinking about the potential of these IPO candidates.

Figma

First up is design-software market Figma. It publicly filed paperwork for a proposed IPO with the Securities and Exchange Commission last Tuesday.

Figma was set to be sold for $20 billion to its larger rival Adobe in 2023 but the deal fell apart in the face of opposition from U.K. regulators. Since then, the sheen has faded somewhat. Last year, the company conducted a tender offer that valued it at $12.5 billion.

Still, the company is growing fast. Figma reported sales of $749 million in 2024, up 48% from the year before. Revenue was $228.2 million for the three months ended March 31, up 46% from the same period a year prior. Figma posted a $732 million net loss in 2024 before recording a profitable March quarter.

Figma plans to list shares under the symbol FIG and hasn’t disclosed its expected price range or how much it hopes to raise.

Cerebras

Another company which has filed paperwork for an IPO is chip maker Cerebras. It is a smaller competitor in the artificial-intelligence processor market to leader Nvidia and is known for making the world’s biggest computer chips in terms of physical size.

AI chips are a hot business and Cerebras is benefiting — revenue of $136.4 million for the first half of 2024 was more than 15 times the same figure from a year earlier, although it reported a net loss of $66.6 million for the six-month period.

However, there are questions about its dependence on its biggest customer, Abu Dhabi-based AI software and services company G42, which accounted for nearly 90% of its revenue in the first half of 2024. That close relationship has been partly responsible for the delay in Cerebras coming to the public markets—after filing for an IPO late last year, the company was left waiting on the completion of a national security review of a $335 million investment in Cerebras by G42.

That review was finalized in late March according to a social-media post by Cerebras CEO Andrew Feldman, but there is still no finalized date for its IPO.

Databricks

A more speculative option is data-storage company Databricks. While it isn’t known to have filed for an IPO, speculation has ramped up following a $10 billion funding round that valued the company at $62 billion late last year.

Databricks is a rival of public company Snowflake —both sell data analytics and data-management software that runs on cloud-computing platforms. Last month, Databricks said it expects to generate $3.7 billion in annualized revenue by July, 50% growth year-over-year.

The company is central to the AI trend, having partnerships with Alphabet ‘s Google, Microsoft and Amazon-backed startup Anthropic to integrate the technology. Databricks also said in May it was purchasing database startup Neon, in a deal valued at about $1 billion to make it easier to build AI agents based on a company’s data.

Write to Adam Clark at adam.clark@barrons.com