Credo's Hidden Moat Could Keep AI GPUs Running

Credo's Hidden Moat Could Keep AI GPUs Running

Credo delivered 115% revenue growth while maintaining a 48.2% non-GAAP operating margin despite significantly higher R&D spending. Management expects fiscal 2027 growth above 85%, optical revenue exceeding $600 million, and net margins approaching 50%. PILOT and ZeroFlap could differentiate Credo through predictive link monitoring as customers report 10% to 20% GPU utilization losses. NPO, Active LED Cables, and OmniConnect introduce additional fiscal 2028 growth vectors beyond Credo’s increasingly mature AEC franchise.

Despite yet another excellent quarter from Credo Technology Group (CRDO), the stock dropped from above $226 to $170. CRDO stock has shown revenue growth of 115% on a year-over-year basis and has consistently beaten analysts' expectations, along with giving