Start here if you're new
what it is
Credo makes chips and cables that move data inside AI and cloud networks.
how it gets paid
Last year Credo Technology made $437M in revenue.
why it's growing
Revenue grew 126.3% last year. Revenue grew 51.9% vs. prior year. Gross margin held at 68.0%.
what just happened
Credo beat the quarter with $1.07 in EPS on $407.0M of revenue.
At a glance
B+ balance sheet — decent shape, but not bulletproof
35.1x trailing p/e — you're paying up for this one
70.0% return on capital — a money-printing machine
xvary composite: 39/100 — weak
$5.30 fy2027 eps est
What they do
Credo makes chips and cables that move data inside AI and cloud networks.
Credo sells the plumbing that moves data at 100 gigabits to 1.6 terabits per second. Once your network is tuned that tightly, swapping vendors is painful. Its 70.0% return on capital means each dollar tied up is pulling back 70 cents in profit, versus 8.5% operating margin.
How they make money
$437M
annual revenue · their business grew +126.3% last year
total revenue
$437M
+126.3%
The products that matter
active electrical cable connectivity
Active Electrical Cables (AEC)
$268M · 66% of latest quarter
this was 66% of revenue in the latest quarter and grew 272% from a year ago. it's the growth engine and the concentration risk at the same time.
core growth driver
optical connectivity and serdes ip
Optical & SerDes IP
$139M · 34% of latest quarter
this made up the other 34% of revenue and grew 51.9% in the period shown. it matters because credo needs more than one winning lane if the multiple is going to hold.
second engine
Key numbers
$156
VL target
's 18-month target is $156, which is 35% above $115.98. That is the bull case in one number.
70.0%
return on capital
Return on capital → profit on money invested → 70% means each dollar put to work comes back with 70 cents of profit.
68.0%
gross margin
Gross margin → money left after making the product → 68% means the business keeps $68 of every $100 before overhead.
35.1x
trailing p/e
Trailing P/E → price paid for each dollar of last year's profit → 35.1x means you are paying $35 for $1 of earnings.
Financial health
B+
strength
- balance sheet grade B+ — solid but not elite
- risk rank 4 — safer than 20% of stocks
- price stability 5 / 100
- net profit margin 42.0% — keeps 42 cents of every dollar in revenue
- return on equity 70% — $0.70 profit for every $1 investors have put in
B+ — functional but not a standout on the balance sheet.
Total return vs. market
Return history isn't available for CRDO right now.
source: institutional data · return history unavailable
What just happened
beat estimates
Credo beat the quarter with $1.07 in EPS on $407.0M of revenue.
Revenue grew 51.9% vs. prior year. Gross margin held at 68.0%, so the company kept a lot of each sales dollar.
$407.0M
revenue
$1.07
eps
68.0%
gross margin
the number that mattered
The $1.07 EPS print beat $0.80 expected by 33.75%, which is the cleanest proof that demand is real.
-
credo technology group has acquired comira solutions.
-
comira is a company specializing in high-speed connectivity intellectual property (ip).comira’s team of designers and engineers have developed ip solutions used in networking, ai, high-performance computing, and server chips. the business has partnered with semiconductor companies to deliver custom ip for connectivity products.
-
this acquisition should help to enhance credo’s offerings.
-
credo’s top line has made commendable progress.
-
in the most recent quarter, revenues expanded 202%, thanks to a substantial uptick in volume unit shipments of aec (active electrical cable) products.
source: company earnings report, 2026
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What could go wrong
the #1 risk is aec concentration inside hyperscale ai spending.
med
AEC is carrying 66% of the latest quarter
one product family generated $268M of the $407M quarter. when one lane drives most of the revenue, any pause in that lane stops being a footnote.
if AEC demand cools, the growth story weakens immediately because the rest of the mix is still smaller.
med
customer concentration can create a revenue cliff
the business depends heavily on hyperscale cloud customers. lose one major buyer and the revenue impact is not a rounding error.
the current page already frames a 20–30% revenue hit as plausible if one large customer walks.
med
Broadcom and Marvell are not exactly sleeping
Credo's AEC and SerDes markets are attractive enough to pull in bigger, better-funded competitors. that is usually how margins get tested.
competition does not need to kill growth to hurt the stock. it only needs to pressure the 39.6% net margin.
med
35.1x earnings leaves little room for a normal quarter
price stability is 5 / 100 and the stock traded from $29 to $165 in the last year. that is what high expectations look like on a chart.
you do not need a broken business to get a painful drawdown. you only need growth to come in less perfect than expected.
when 66% of revenue sits in AEC and the stock scores 5 / 100 on price stability, even a small slowdown can hit both revenue and the multiple.
source: institutional data · regulatory filings · risk analysis
Pay attention to
mix
AEC share of revenue
it was 66% in the latest quarter. if that number keeps climbing, growth is working but concentration is getting worse.
earnings
next earnings and guidance
the last reported quarter grew 52% from the previous one. from here, the market cares less about the beat and more about whether management can keep the pace.
competition
Broadcom and Marvell in active cables
design-win headlines from larger rivals matter because Credo's best numbers are coming from exactly the category they want too.
estimates
fy2026 EPS revisions
the street is at $4.30 after a 13% lift. if that estimate stops moving higher, momentum probably cools with it.
Analyst rankings
short-term outlook
below average
momentum score 4. in human-speak, analysts think the setup is vulnerable after a big run.
risk profile
below average
stability score 4 means more volatility than most stocks. this is not a defensive semiconductor name.
chart momentum
average
technical score 3 says the chart is not sending an extreme signal either way. the business story is louder than the tape.
source: institutional data
Institutional activity
institutions have been net buying for 3 consecutive quarters — 362 buyers vs. 207 sellers in 4q2025. total institutional holdings: 0.1B shares. net buying for 3 quarters.
source: institutional data
Price targets
3-5 year target range
$91
$221
$116
current price
$156
target midpoint · +35% from current · 3-5yr high: $175 (+50% · 11% ann'l return)
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