I Doubled Down Aggressively After Credo's Brutal Crash

Credo Technology's Q1 revenue surged 115% YoY to $479 million, marking Credo’s seventh consecutive quarter of triple-digit annual growth. Management expects 85%+ FY2027 revenue growth and roughly 50% non-GAAP net margins, despite concerns around AI spending normalization. Optical revenue should exceed $600 million in FY2027, with silicon photonics, ZeroFlap, and optical DSPs becoming major growth engines. Following the correction, CRDO trades around 25.9x forward non-GAAP earnings with a 0.52 PEG, dramatically improving its risk/reward profile.

Credo Technology (CRDO) crashed from all-time highs, but I believe the correction stems from valuation pressure and worries about decelerating AI infrastructure spending, rather than any problems with the business model.