Live: Credo Technology (CRDO) Q2 Earnings Coverage

"Credo Technology (Nasdaq: CRDO) has quickly become one of the most important connectivity suppliers in the AI-infrastructure stack. The company delivered record revenue and profitability last quarter as hyperscalers continued to ramp deployments of active electrical cables, optical DSPs and PCIe retimer solutions. With AI cluster buildouts accelerating globally, expectations are elevated heading into the upcoming report. Wall Street sees continued year-over-year expansion across revenue and EPS, along with another quarter of notable gross margin performance."

"1. Hyperscaler ramp velocity and new customer expansion- Management emphasized that three hyperscalers contributed more than 10% of revenue last quarter, with a fourth hyperscaler achieving first material revenue and expected to cross the 10% threshold this fiscal year. The call also indicated that a fifth hyperscaler is through qualification, with traction expected toward year-end. This breadth of adoption is a critical signal for forward demand."

"2. AEC share gains across intra-rack and emerging rack-to-rack deployments- The company noted that AEC adoption is expanding beyond intra-rack into rack-to-rack architectures, driven by reliability and power efficiency advantages over optical solutions. Management pointed to customers architecting entire scale-out networks using AECs up to 7 meters, with AECs described as up to 1,000x more reliable than optical. This represents a significant TAM expansion if the trend accelerates."

Three hyperscalers each contributed more than 10% of revenue last quarter, a fourth achieved first material revenue and is expected to cross the 10% threshold this fiscal year, and a fifth has completed qualification with traction expected toward year-end. Wall Street models 226% year-over-year revenue growth for the upcoming quarter and normalized EPS more than six times last year, following a quarter that delivered 274% revenue growth and 44.1% net margin. AEC adoption is expanding from intra-rack into rack-to-rack architectures, with deployments up to seven meters and reliability claims of up to 1,000x versus optical, signaling significant TAM expansion. Active electrical cables, optical DSPs, and PCIe retimers are key product drivers.

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