Credo Technology Group Holding Ltd (NASDAQ:CRDO) Quarterly Earnings Preview

Credo Technology Group Holding Ltd (NASDAQ:CRDO) is a prominent player in the electronics and semiconductors industry, specializing in secure, high-speed connectivity solutions for AI-driven applications, cloud computing, and hyperscale networks. The company recently reported its Q1 2026 financial results, showcasing impressive performance metrics that have caught the attention of investors and analysts alike.

On September 3, 2025, CRDO reported earnings per share (EPS) of $0.52, significantly surpassing the estimated $0.36. This represents a substantial increase from the $0.04 per share reported a year ago, highlighting the company's strong growth trajectory. The earnings surprise for this quarter stands at 48.57%, as highlighted by Zacks, marking the fourth consecutive quarter that Credo has outperformed consensus EPS estimates.

In addition to robust earnings, Credo reported revenues of approximately $223.1 million, exceeding the estimated $190.6 million. This marks a 17.41% increase over the Zacks Consensus Estimate and a significant rise from the $59.71 million in revenues from the same quarter last year. The company's consistent ability to surpass revenue estimates underscores its strong market position and growth potential.

Despite its impressive financial performance, CRDO's valuation metrics indicate a high valuation relative to its earnings. The company's price-to-earnings (P/E) ratio is approximately 407.44, and its price-to-sales ratio stands at about 49.03. These figures suggest that investors are willing to pay a premium for each dollar of sales, reflecting high expectations for future growth.

Credo's financial health is further supported by a strong liquidity position, with a current ratio of 6.62, indicating the company's ability to cover short-term liabilities. Additionally, the debt-to-equity ratio is 0.02, showing minimal debt compared to equity. These metrics suggest that Credo is well-positioned to sustain its growth momentum while maintaining financial stability.

• Analysts have raised the average price target for CRDO to $135, reflecting optimism about its future performance.
• The company's revenue is expected to exceed $800 million by fiscal 2026, driven by its optical DSP business and AI-driven connectivity solutions.
• Credo's stock price has increased by nearly 90% since the last update, supported by strong business momentum and revenue diversification.

Credo Technology Group Holding Ltd (NASDAQ:CRDO) is a company that specializes in high-speed connectivity solutions, focusing on optical DSP and AI-driven connectivity. The company has been gaining attention due to its strong business momentum and significant growth prospects. Analysts have shown increasing optimism about CRDO's potential, as reflected in the upward trend of its stock consensus target price.

Last month, the average price target for CRDO was $135, indicating a positive outlook from analysts. This optimism is supported by the company's strong performance in its optical DSP business, driven by new design wins and record efficiency gains. Credo's projected revenues are expected to exceed $800 million in fiscal 2026, highlighting its growth potential.

Three months ago, the average price target was $105, showing a significant upward revision over the past quarter. This reflects increased confidence in Credo's strategic direction and financial health. The company concluded its fiscal year 2025 with a robust cash reserve of $431.3 million, positioning it well to capitalize on emerging opportunities within the AI sector.

A year ago, the average price target was $62.94, and the substantial increase to the current target of $135 highlights strong positive sentiment. Credo's remarkable growth is driven by increasing demand in the AI and data center sectors. The company's valuation is considered premium, justified by its tangible revenues and profitability, despite facing execution and competitive risks.

Credo Technology has experienced a significant rally, with its stock price increasing by nearly 90% since the last update. The company's strong business momentum and revenue diversification support a continued bullish outlook. Credo's guidance for fiscal year 2026 indicates over 85% year-over-year sales growth and an approximately 40% net margin, driven by product and software innovation.

Credo Technology Group Holding Ltd, listed on NASDAQ as CRDO, is a prominent player in the high-speed connectivity equipment sector, primarily serving data centers. The company is set to release its quarterly earnings on September 3, 2025, with Wall Street analysts estimating an earnings per share of $0.35 and projected revenue of approximately $190.6 million.

Credo's stock has recently surged to a record high, as highlighted by Investors.com, driven by its strong performance in the optical DSP business. The company has secured an 800G DSP transceiver design win, with deployments expected in fiscal 2026. This development is anticipated to boost Credo's total revenues beyond $800 million in fiscal 2026, supported by the growing demand for AI-driven connectivity.

In fiscal 2025, Credo demonstrated a remarkable 126% revenue growth, showcasing its robust financial performance. The company ended the year with a strong cash position of $431.3 million and a significant increase in cash flow from operating activities, reaching $57.8 million in the fourth quarter. This financial strength is expected to support Credo's expansion into AI-driven product offerings.

Credo's portfolio includes low-power, high-performance PAM4 DSP integrated circuits, which cater to diverse network architectures. These DSPs are designed for efficiency, delivering cutting-edge performance with low latency and power, while remaining cost-optimized. The company's healthy cash reserves are poised to bolster its competitive edge in the rapidly evolving AI landscape.

Despite a high price-to-earnings (P/E) ratio of approximately 430.46, Credo maintains a strong liquidity position with a current ratio of 6.62. The company's debt-to-equity ratio of 0.02 indicates a very low level of debt compared to its equity, reflecting financial stability. As Credo continues to grow, its financial metrics suggest a promising outlook in the high-speed connectivity market.

Credo Technology Group Holding Ltd, listed as NASDAQ:CRDO, specializes in data center connectivity solutions. The company is gaining attention due to its recent stock performance and strategic positioning in the market. On June 20, 2025, Laufman James, the Chief Legal Officer and Secretary, sold 5,000 shares at approximately $85.07 each, retaining 249,346 shares post-transaction.

The stock's recent rise is largely attributed to analyst Joshua Buchalter from TD Cowen, who identified Credo as a top pick in the small and mid-cap categories. Buchalter increased his fair value assessment of Credo's stock from $85 to $95 per share, maintaining a buy rating. This endorsement led to a 16% increase in Credo's share price, as reported by S&P Global Market Intelligence.

Credo's financial metrics reveal a high valuation, with a P/E ratio of 279.24, indicating that investors are paying a premium for its earnings. The price-to-sales ratio of 33.24 and enterprise value to sales ratio of 32.73 further highlight the company's high valuation relative to its sales. These figures suggest strong investor confidence in Credo's growth potential.

Despite the high valuation, Credo maintains a strong balance sheet with a debt-to-equity ratio of 0.0186, indicating minimal debt. The current ratio of 6.62 reflects a robust liquidity position, ensuring the company can cover its short-term liabilities. However, the enterprise value to operating cash flow ratio of 1252.06 suggests that operating cash flow is low compared to the company's enterprise value.

The company's prospects are bolstered by the growing demand for artificial intelligence (AI), as highlighted by Buchalter. This demand is expected to positively impact Credo's future performance, making it a compelling choice for investors looking for opportunities in the small and mid-cap sectors.

Credo Technology Group Holding Ltd, trading on NASDAQ:CRDO, specializes in high-performance connectivity solutions that are both innovative and energy-efficient. The company recently reported its financial results for the fourth quarter of fiscal 2025, showcasing a strong performance that exceeded market expectations. Credo's solutions are particularly popular among hyperscaler customers who use them to power advanced AI services.

On June 2, 2025, CRDO reported earnings per share of $0.35, surpassing the estimated $0.27. This achievement reflects a significant year-over-year revenue increase of 179.7% and a sequential rise of 25.9%, as highlighted by the company's financial results. The revenue for the quarter reached $170 million, exceeding the estimated $159.6 million, and surpassing analyst predictions of approximately $163 million.

Credo's financial health is further underscored by its adjusted gross margin of 67.4% and a strong cash position, with $431 million in cash and short-term investments. Despite a high price-to-earnings (P/E) ratio of 2058.55, the company maintains a low debt-to-equity ratio of 0.026, indicating financial stability. The current ratio of 7.67 suggests a robust ability to cover short-term liabilities.

The company's valuation metrics, such as a price-to-sales ratio of 32.48 and an enterprise value to sales ratio of 31.62, indicate that investors are willing to pay a premium for Credo's sales. However, the enterprise value to operating cash flow ratio is notably high at 906.90, which may suggest that the company's cash flow is relatively low compared to its enterprise value.

Bill Brennan, the president and CEO of Credo Technology Group, attributes the impressive results to a "surging demand" for the company's solutions. This demand is driven by hyperscaler customers leveraging Credo's technology for advanced AI services, a trend expected to continue. Despite a low earnings yield of 0.0486%, the company's strong financial position and innovative solutions position it well for future growth.

Credo Technology Group Holding Ltd. (NASDAQ:CRDO) is a company based in San Jose, California, known for its innovative solutions in secure, high-speed connectivity. These solutions are crucial as data rates and bandwidth demands increase in the data infrastructure market. Despite its technological advancements, CRDO faces challenges in its financial metrics.

On December 2, 2024, CRDO reported earnings per share of $0.07, exceeding the Zacks Consensus Estimate of $0.05. This positive earnings surprise indicates the company's ability to manage costs and improve profitability. However, the company generated revenue of $72 million, falling short of the estimated $86 million, which may raise concerns about its revenue-generating capabilities.

The price-to-sales ratio of 36.48 shows that investors are willing to pay a high premium for each dollar of sales, reflecting high expectations for future growth. The enterprise value to sales ratio is 36.08, similar to the price-to-sales ratio, indicating the company's valuation relative to its revenue. However, the enterprise value to operating cash flow ratio is extremely high at 8,791.30, suggesting that investors are paying a significant premium on the company's cash flow, which may not be sustainable in the long term.

Despite these challenges, CRDO maintains a strong liquidity position with a current ratio of 7.81. This indicates that the company has ample resources to cover its short-term liabilities, providing a buffer against financial uncertainties.