Credo Technology $CRDO ( ▲ 9.09% ) is having a moment. Shares jumped in early trading after the data center connectivity company released preliminary third quarter results that blew past expectations and signaled explosive growth ahead.
The update reinforced Credo’s role as a key supplier in the fast growing AI and data center buildout cycle.
Sales Smash Expectations
Credo $CRDO said Q3 revenue will land between $404 million and $408 million. That is well above both the high end of its prior guidance and Wall Street’s forecast of $341 million. Investors quickly piled in, sending the stock sharply higher.
Management also projected revenue will grow in the mid single digits sequentially each quarter, setting the stage for more than 200% year over year growth for the full fiscal year. That kind of acceleration is rare, even in the high growth semiconductor space.
Riding the Data Center Upgrade Wave
Credo $CRDO sells active electrical cables and other high speed connectivity products used in data centers. These components are critical as operators upgrade networks to handle heavier AI workloads and faster data movement between servers and switches.
Analysts see plenty of runway left. Needham’s Quinn Bolton reaffirmed the stock as a top pick, arguing the industry is still in the early stages of adopting AEC technology. He noted that only one major customer has fully rolled out AECs across all possible use cases so far, suggesting adoption could expand significantly from here.
Wall Street Gets More Bullish
Following the update, Bolton raised his revenue forecasts for Credo $CRDO not just for next year, but for the year after as well. He also pointed to strong visibility into demand over the next twelve months and beyond.
For investors looking for companies tied directly to the infrastructure powering AI, Credo’s latest numbers show it is not just participating in the boom, it is accelerating right alongside it.