Key Takeaways
- Credo rose 6.3% to $182 on October 21, yet the stock still trades 41% below its 52-week high of $309.
- Fiscal Q1 revenue climbed 114.7% to $479 million, and Q2 guidance calls for $525 million to $535 million.
- Executives have sold about $50 million of stock since mid-September, including $20.6 million from the COO.
- The fiscal Q2 report in early December should show whether optical and memory products start getting revenue timelines.
Credo Technology (CRDO) spent two months doing what growth stocks hate most: falling while the numbers kept rising.
Then October 21 arrived. Shares jumped 6.3% to $182 as a broad rebound in AI hardware lifted the group. Even after the bounce, the stock sits 41% below its 52-week high of $309.
The fundamentals never cracked, and the latest quarter marked a seventh straight period of triple-digit growth. Yet the company’s own executives have been some of the steadiest sellers.
That mix of record results, new product bets and insider selling makes Credo one of the stranger setups in AI connectivity.
Seven straight quarters of triple digits
Fiscal Q1 revenue reached $479 million, up 9.6% sequentially and 114.7% from a year earlier. Non-GAAP EPS of $1.20 beat the $1.17 estimate, while non-GAAP net income rose 140% to $236.3 million.
The guide kept the pace:
- Q2 revenue of $525 million to $535 million, about 11% sequential growth at the midpoint.
- Non-GAAP gross margin of 67% to 69%.
- Cash and short-term investments of $764 million, with no net debt.
The quarterly climb has been relentless…
Revenue more than doubled in a year. Even so, the stock fell 9% after the report, because expectations were already sky-high.
From cables to optics to memory
Credo built its name on active electrical cables, and it is now pushing into two new markets at once.
The first is optics. Credo closed its DustPhotonics deal in May for $750 million in cash plus about 0.92 million shares. That brings silicon photonics in-house and supports an 800G, 1.6T and 3.2T optical roadmap.
The second is memory. With Advanced Micro Devices (AMD), Credo built a working emulation platform for OmniConnect Weaver on AMD’s Versal AI Edge Gen 2 chip. The demo showed terabyte-class LPDDR memory access over Credo links on standard organic packaging, with no silicon interposer.
Margins are the variable to watch as the mix shifts.
Credo’s 67.1% trailing gross margin dwarfs Coherent (COHR) at 37.5% and Lumentum (LITE) at 44.2%. Holding the high 60s as optical sales grow would be a strong signal, since those optics peers run far leaner.
Weaver remains early, though. Credo has not given a commercial timeline, so it adds optionality rather than near-term revenue.
TIKR tracks 20 analysts on Credo Technology. How many say “Buy”?
See the full breakdown of Buy, Hold, and Sell ratings on Credo Technology, along with Wall Street’s revenue and earnings estimates, all in one place. More than 500,000 investors use TIKR to research stocks like this one. See Credo Technology’s Analyst Ratings
Insiders keep cashing out
Credo’s executives have been active sellers. Since mid-September, the COO sold $20.6 million, the CTO disposed of roughly $20.6 million across five filings, and the CEO sold about $5.4 million. Adding the CFO and chief legal officer, the total reaches about $50 million.
We do not know whether these sales follow prearranged trading plans, so no single filing proves much. The pattern still deserves attention.
So what are buyers paying now?
At 21.4x forward EV/EBITDA, Credo trades below Lumentum’s 26.7x. The $279 average analyst target sits about 53% above the current price.
My take: Credo’s core business looks excellent, and the memory work could open a market well beyond cables. But hyperscaler concentration means any order shift hurts, and the new bets still need to show up in reported numbers. The drawdown makes the valuation easier to defend, while the insider selling makes me want proof first.
The fiscal Q2 report, expected in early December, is the checkpoint. Watch whether revenue lands near $530 million and whether management puts any timing on optical and Weaver revenue.
So what is Credo stock actually worth?
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Disclaimer:
Please note that the articles on TIKR are not intended to serve as investment or financial advice from TIKR or our content team, nor are they recommendations to buy or sell any stocks. We create our content based on TIKR Terminal’s investment data and analysts’ estimates. Our analysis might not include recent company news or important updates. TIKR has no position in any stocks mentioned. Thank you for reading, and happy investing!
