Credo Technology (CRDO)

AI connectivity silicon (Credo) — SerDes/active-electrical-cables for AI data-center links

AI exposure 90% — derived from reported segment revenue, not asserted.

Where it sits

Connectivity → Optical Components & Photonics · figures rebased to Q1 FY2027, reported 2026-09-01

Active Electrical Cables (AECs/HiWire) — high-speed copper interconnect leads 3 businesses in this sub-tier that together are 88% of revenue, so Optical Components & Photonics is effectively the whole company rather than one leg of it. The rest is tagged separately: Semiconductor Devices at 12%.

Also tagged: emerging in Silicon Layer → Semiconductor Devices.

Reported segments

• Product revenue (~96%) — 96% of revenue
• IP licensing (SerDes IP) (~4%) — 4% of revenue

Credo ($479M Q1 FY2027, +115% YoY and +10% sequentially — a record, and a SEVENTH consecutive quarter of triple-digit year-over-year growth). Non-GAAP net income $236.3M at a 49.3% net margin. Credo does not disaggregate revenue in its 10-Q, so the product-versus-IP split below is held at the prior Atlas ratio; management did state that the optical DSP business set a first-quarter record on 50G- and 100G-per-lane deployments. Q2 FY2027 is guided to $525-535M, another double-digit sequential step.

How the 90% is built

• Product revenue (~96%) — 96% of revenue × 90% AI-driven (estimate). AECs and SerDes-based connectivity products are sold overwhelmingly into hyperscaler AI clusters, with a small non-AI enterprise/telecom tail
• IP licensing (SerDes IP) (~4%) — 4% of revenue × 80% AI-driven (estimate). Licensed SerDes IP is used mainly in AI-networking-adjacent chip designs

Investment read

Moat. SerDes IP plus Active Electrical Cables for in-rack AI links, now with silicon photonics in-house after the DustPhotonics acquisition closed in May 2026. The advantage is design-win incumbency at named hyperscaler and OEM programs, not scale — Broadcom, Marvell and Astera contest the same sockets, and with the top three customers at ~88% of revenue, the concentration is both the leverage and the risk.

Bottleneck / pricing power. Real pricing power in AECs and SerDes — design-win-locked at the in-rack/short-reach interconnect bottleneck, holding a 68.1% non-GAAP gross margin through a 206% revenue year. It is offset by three customers with hyperscaler bargaining power and by an optical mix shift management guides toward a 63-65% long-run margin.

Role in the AI stack. The in-rack/short-reach AI-connectivity silicon layer (AEC/SerDes).

Connected companies

• Taiwan Semiconductor (TSM) — CRDO is supplied by: foundry for SerDes / connectivity silicon (fabless)
• Amazon (AMZN) — CRDO supplies: active electrical cables (AECs) for AWS AI clusters
• Microsoft (MSFT) — CRDO supplies: high-speed interconnect for Azure AI racks
• NVIDIA (NVDA) — CRDO supplies: AECs + optical DSPs for GPU-cluster interconnect
• Astera Labs (ALAB) — CRDO competes with: AI interconnect silicon — Astera Labs (retimers/fabric switches) vs Credo (retimers/AECs)
• Marvell Technology (MRVL) — CRDO competes with: optical DSPs + interconnect — Credo vs Marvell (Inphi, ~70% DSP share)
• Coherent (COHR) — CRDO competes with: Adjacent AI-interconnect players — Coherent optics/transceivers vs Credo DSP/copper-cable silicon; overlap mainly at short reach
• MACOM Technology (MTSI) — CRDO competes with: adjacent data-center connectivity — MACOM (drivers/TIAs/lasers) vs Credo (AECs/retimers/SerDes); overlap mainly at optical-DSP margin
• Meta Platforms (META) — CRDO supplies: active electrical cables (AECs) wiring META AI GPU racks
• Alphabet (GOOGL) — CRDO supplies: connectivity (AECs/SerDes) potentially for GOOGL AI data centers — core Credo customers are Microsoft/Amazon/xAI
• Oracle (ORCL) — CRDO supplies: co-developed ZeroFlap AEC/optical connectivity for OCI AI clusters
• CoreWeave (CRWV) — CRDO supplies: connectivity (AECs/optical DSP) for CRWV AI data centers
• Freeport-McMoRan (FCX) — CRDO is supplied by: Copper twinax conductor (via commodity/cable-supplier chain) in AECs; no direct FCX-Credo supply named
• Southern Copper (SCCO) — CRDO is supplied by: Copper twinax conductor (via commodity/cable-supplier chain) in AECs; no direct SCCO-Credo supply named

Others in Optical Components & Photonics

• Coherent (COHR)
• Lumentum Holdings (LITE)
• Corning (GLW)
• MACOM Technology (MTSI)

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