Astera Labs Stock Surges on New Fabric Switches for AI

Astera Labs, a global leader in semiconductor-based connectivity solutions for AI and cloud infrastructure, has seen its stock price surge following the announcement of its new portfolio of fabric switches, including the industry's first PCIe 6 switch. The Scorpio Smart Fabric Switch portfolio is purpose-built for demanding AI workloads in accelerated computing platforms deployed at cloud-scale, delivering maximum predictable performance per watt, high reliability, easy cloud-scale deployment, reduced time-to-market, and lower total cost of ownership.

The Scorpio portfolio features two application-specific product lines with a multi-generational roadmap: Scorpio P-Series for GPU-to-CPU/NIC/SSD PCIe 6 connectivity and Scorpio X-Series for back-end GPU clustering. These switches are architected to support mixed traffic head-node connectivity and deliver the highest back-end GPU-to-GPU bandwidth with platform-specific customization, respectively.

Astera Labs' new fabric switches address several critical challenges with next-generation AI infrastructure deployments, such as the need for energy-efficient connectivity solutions that deliver uncompromised performance and return as much power as possible to the accelerator/GPU. The Scorpio portfolio is built from the ground up to improve energy efficiency, increase GPU utilization, maximize uptime, and reduce time to market.

The Scorpio Smart Fabric Switches expand Astera Labs' Intelligent Connectivity Platform and integrate with the COnnectivity System Management and Optimization Software (COSMOS) suite to deliver a smart, customizable connectivity backbone with unprecedented data center observability, enhanced security, and extensive fleet management capabilities. Scorpio enables unmatched insights into the state and health of accelerated computing platforms to ensure maximum uptime and availability.

Astera Labs' stock price has surged on the news of its new fabric switches, with ALAB stock jumping more than 17% in morning trades on the stock market today. Morgan Stanley analyst Joseph Moore reiterated his overweight, or buy, rating on Astera Labs and raised his price target on ALAB stock to 74 from 55. Needham analyst Quinn Bolton kept his buy rating on ALAB stock with a price target of 65.

The market for switches is very large, estimated at $5 billion, and Astera Labs has an opportunity to compete here with its first-of-its-kind PCIe 6 switches. The new product line competes directly with incumbents, including Broadcom, which have less efficient, traditionally architected PCIe switches. Astera Labs' Scorpio Smart Fabric Switches are now shipping in pre-production quantities for head-node PCIe 6 connectivity and ready to propel AI platform deployments utilizing industry-leading GPUs with reliable plug-and-play interoperability, advanced diagnostics and telemetry, and comprehensive design collateral.

Astera Labs will demonstrate its new Scorpio Smart Fabric Switch portfolio at OCP 2024, October 15-17, in San Jose, California. The company will showcase its solutions in Booth B13 and offer the opportunity to meet with Astera Labs experts to learn how its solutions enable critical connectivity for AI and cloud infrastructure.