Overview
- In April, Credo reported fiscal Q3 revenue of $407 million, up 51.9% from the prior quarter and 201.5% from a year earlier, as large cloud customers scaled new deployments.
- Management said it has signed a fifth hyperscaler and disclosed customer concentration with three clients representing 39%, 32%, and 17% of Q3 sales, which could cause uneven quarterly results.
- Active electrical cables, the copper links used for short runs inside AI data centers, are driving growth because they use about half the power and fail far less often than comparable optical links.
- Guidance points to Q4 revenue of $425 million to $435 million, and analysts expect the ZeroFlap optics line to begin adding revenue by fiscal 2027 after recent customer wins.
- Shares have fallen recently and trade above the industry’s average price-to-sales multiple, yet most analysts rate the stock a buy even after Susquehanna and BofA lowered price targets.