Credo Technology (CRDO) Surges Amid AI Data Center Growth
ByAinvest
Monday, Sep 22, 2025 8:21 am ET1min read
CRDO--
The company anticipates mid-single-digit sequential revenue growth for fiscal 2026, resulting in approximately 120% year-over-year growth. This growth is attributed to the increasing adoption of active electrical cables (AEC) and optical Digital Signal Processors (DSP) in the data center space. CRDO's AEC product line, which is a key growth driver, saw double-digit sequential growth in the last reported quarter [1].
The company's optical DSP segment also maintained strong momentum, positioning it to achieve a doubling of optical revenues in the current fiscal year. Additionally, recently launched PCIe retimer solutions have gained significant traction and are expected to generate production revenues in 2026 [1].
CRDO's strong competitive positioning is further bolstered by its system-level approach, which encompasses the entire stack of SerDes IP, Retimer ICs, system-level design, qualification, and production. This integrated approach allows for faster innovation cycles and strong cost efficiency [1].
However, the company faces intensifying competition in the market, with semiconductor giants like Broadcom (AVGO) and new players such as Astera Labs (ALAB) vying for market share [1]. Despite the challenges, CRDO's strong financial performance and robust growth prospects have been recognized by multiple analysts, with several firms raising their price targets and maintaining Outperform ratings [2].
Credo's shares have gained 38.5% in the past month and are currently trading near their 52-week high, with a forward 12-month Price/Sales ratio of 27.4, higher than the Electronic-Semiconductors sector's multiple of 9.62 [1]. The Zacks Consensus Estimate for CRDO earnings for fiscal 2026 has been revised upwards significantly over the past 60 days, and the stock currently sports a Zacks Rank #1 (Strong Buy) [1].
In the latest quarter, Credo reported a quarterly revenue of $223.07 million, significantly exceeding analyst estimates, though earnings per share missed expectations by $0.02 [3]. The company's CTO, Chi Fung Cheng, sold 55,000 shares of the company's stock in a transaction on September 15th, valued at approximately $9.02 million, though the sale was a 0.78% decrease in their ownership of the stock [3].
Credo Technology Group Holding Ltd (CRDO) is a semiconductor and connectivity solutions provider benefiting from AI data center buildouts by its largest customers, including Amazon and Microsoft. The company grew revenues by nearly 180% in its most recent reported quarter and expects revenue growth to be greater than 200% in the current quarter. CRDO's shares gained 46.92% in the one-month return and 469.18% over the last 52 weeks.
Credo Technology Group Holding Ltd (CRDO) has reported robust revenue growth in the first quarter of fiscal 2026, driven by surging demand from hyperscalers and data center operators. The company's revenues surged 31% sequentially and 274% year-over-year to $223.1 million, significantly exceeding management's guidance of $185 million to $195 million [1].The company anticipates mid-single-digit sequential revenue growth for fiscal 2026, resulting in approximately 120% year-over-year growth. This growth is attributed to the increasing adoption of active electrical cables (AEC) and optical Digital Signal Processors (DSP) in the data center space. CRDO's AEC product line, which is a key growth driver, saw double-digit sequential growth in the last reported quarter [1].
The company's optical DSP segment also maintained strong momentum, positioning it to achieve a doubling of optical revenues in the current fiscal year. Additionally, recently launched PCIe retimer solutions have gained significant traction and are expected to generate production revenues in 2026 [1].
CRDO's strong competitive positioning is further bolstered by its system-level approach, which encompasses the entire stack of SerDes IP, Retimer ICs, system-level design, qualification, and production. This integrated approach allows for faster innovation cycles and strong cost efficiency [1].
However, the company faces intensifying competition in the market, with semiconductor giants like Broadcom (AVGO) and new players such as Astera Labs (ALAB) vying for market share [1]. Despite the challenges, CRDO's strong financial performance and robust growth prospects have been recognized by multiple analysts, with several firms raising their price targets and maintaining Outperform ratings [2].
Credo's shares have gained 38.5% in the past month and are currently trading near their 52-week high, with a forward 12-month Price/Sales ratio of 27.4, higher than the Electronic-Semiconductors sector's multiple of 9.62 [1]. The Zacks Consensus Estimate for CRDO earnings for fiscal 2026 has been revised upwards significantly over the past 60 days, and the stock currently sports a Zacks Rank #1 (Strong Buy) [1].
In the latest quarter, Credo reported a quarterly revenue of $223.07 million, significantly exceeding analyst estimates, though earnings per share missed expectations by $0.02 [3]. The company's CTO, Chi Fung Cheng, sold 55,000 shares of the company's stock in a transaction on September 15th, valued at approximately $9.02 million, though the sale was a 0.78% decrease in their ownership of the stock [3].
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