Another Look At Emerging AI Superstock, Credo Technology

Charts work well for Credo Technology, and this is a positive chart, with Coppock resuming its rise and a buy signal following a convergence of the moving averages. The pattern resembles a bull hook, a characteristic shape associated with a strong bull market.

The fundamentals could hardly be more explosive.

CEO Bill Brennan highlighted that Credo delivered revenue of $170 million in Q4, a 26% sequential increase and up 180% year-over-year. For fiscal 2025, revenue reached $437 million, reflecting 126% year-over-year growth. Brennan stated, “Quarterly revenue nearly tripled from Q1 to Q4, validating our foresight and our ability to capitalize on a predicted inflection point.” He emphasized the company’s focus on innovative, reliable, and energy-efficient high-performance connectivity solutions, with a significant ramp in active electrical cable (AEC), optical, and retimer product lines.

For the full fiscal year 2026, Fleming said, “We expect revenue to exceed $800 million for year-over-year growth in excess of 85%. We expect non-GAAP operating expenses to grow at less than half the rate of revenue from fiscal year ’25 to fiscal year ’26, and as a result, we expect our non-GAAP net margin to approach 40%.”

Bill Brennan, CEO, Credo Technolgies, Q4 2025, 2 June 2025

Credo is a booming business whose fast-innovating products lie at the heart of the accelerating technology infrastructure build-out.

Quarterly revenue nearly tripled from Q1 to Q4, validating our foresight and our ability to capitalize on a predicted inflection point. Our agile approach strengthened partnerships with hyperscalers amid a rapidly evolving AI landscape. As a pure play high-speed connectivity leader, Credo delivers a growing portfolio of differentiated solutions for global data center operators, currently supporting port speeds from 100 gigabits per second to 1.6 terabits per second.

Our innovation spans three tiers, advanced SerDes technology, cutting-edge integrated circuit design and comprehensive system level solutions. These innovations are seamlessly integrated with our PILOT software platform. PILOT is an acronym for predictive integrity, link optimization and telemetry.

PILOT offers an industry leading user interface, robust debugging tools and advanced telemetry tailored for large scale deployments. This holistic innovation strategy enables Credo to deliver copper and optical connectivity solutions that surpass industry standards, providing unmatched functionality, reliability and energy efficiency, while achieving a remarkable revenue ramp in fiscal ’25, we continue to build the foundation for sustained growth.

Looking ahead, we anticipate increasing customer diversification across copper and optical connectivity for ethernet, PCIe, UA Link and other emerging applications in both scale-out and scale-up AI networks. Following the significant revenue inflection in fiscal ’25, we’re energized by the expanding opportunities and total addressable market that lie ahead.

[SerDes, short for Serializer/Deserializer, is a technology used in high-speed data transmission to convert parallel data into a serial stream for transmission and then back into parallel data at the receiving end. This conversion reduces the number of data paths, interconnects, and pins required, and can also mitigate issues like power consumption, electromagnetic interference, and clock timing skew associated with parallel data transmission. ]

Bill Brennan, CEO, Credo Technolgies, Q4 2025, 2 June 2025

Share Recommendations

Credo Technology. CRDO

Strategy – Another Booming ‘Dirty Dozen’ Stock

My top 12 for excitement stocks are doing well, with several already showing substantial gains even before my anticipated mega bull market (MAGA bull market) has picked up steam. Credo CEO Bill Brennan said he anticipated the company’s growth reaching an inflexion point in 2025, and this has happened with a vengeance.

Investors looking for excitement need look no further, with quarterly revenue almost tripling from Q1 to Q4 and strong following winds for the group’s business.

An enthusiastic analyst explains what Credo does.

CRDO – as we just mentioned – is a company that makes networking solutions for AI data centers. This may sound like an incredibly boring business, but in an AI data center, huge amounts of data need to move quickly and reliably between logic chips, storage, and servers. CRDO’s products improve this process and make it faster (and more power efficient), which is essential for running high-powered AI models.

At a more granular level, CRDO makes three core product lines, including Active Electrical Cables (AECs), Optical DSP Chips, and Re-Timers.

Active Electrical Cables are like hyper powerful ethernet cables for cloud servers. DSP Chips are the ‘brains’ inside fiber optic links that convert data into light and back, and Re-Timers manage data traffic by cleaning up noisy signals and ensuring that information gets where it needs to go:

Together, these products form the crucial ‘backbone’ of the modern AI data center, especially given that recent increases in compute power have rendered many old networking systems obsolete.

CRDO’s products are generally regarded as cutting-edge, which has driven the company’s incredibly strong growth in recent periods.

Seeking Alpha, 17 June 2025, PropNotes

As he notes, the business is delivering almost unbelievable results.

Right now, management is forecasting that over the next year, CRDO will produce more than $800 million in revenue, and achieve net margins in the 40% range. Results like this are incredibly hard to come by in the public markets and shouldn’t be ignored. If CRDO can achieve $800 million in sales over the next 12 months and a 40% net income margin, this would represent 85% YoY growth in revenue, and considerable margin expansion that could boost profitability to more than $320 million.

Given that the company has structurally almost no debt, we view this financial setup as being very accretive to shareholders. As net income flows to the bottom line, we expect CRDO’s dilution will cease and reinvestments can be made into R&D, which should allow the company to scale even further.

Overall, we think CRDO’s organic business outlook remains incredibly strong. This is due to the firm’s considerable exposure to a strong secular trend in AI, alongside the CRDO’s broadened customer base and margin expansion potential.

Seeking Alpha, 17 June 2025, PropNotes

As I noted in a previous alert, the extraordinary thing about the share price performance is the fall from a peak of $85 to $29 when trading was booming. The stock market is bizarre! This company ticks all the boxes for me and looks like an excellent stock to accumulate.

I am listening to Ballerina by Van Morrison blasting out from my Bose speakers – 7 minutes of ecstasy!