Highlights

  • First quarter fiscal 2027 revenue was USD 479.0 million, compared with USD 223.1 million a year earlier.
  • GAAP net income was USD 129.4 million, or USD 0.67 per diluted share, against USD 63.4 million, or USD 0.34.
  • Cash and cash equivalents were USD 466.9 million at August 1, after a USD 735.6 million net payment for DustPhotonics.
  • Second quarter fiscal 2027 guidance: revenue of USD 525 million to 535 million; non-GAAP gross margin of 67% to 69%.

Credo Technology Group Holding Ltd (NASDAQ: CRDO) shares closed at USD 147.29 on October 23, 2026, down 9.51%. The connectivity company reported first quarter fiscal 2027 results in early September and completed its DustPhotonics acquisition during the quarter.

Credo is a Cayman Islands company whose principal executive offices are listed c/o Maples Corporate Services in Grand Cayman. It designs high-speed copper and optical interconnect products for data infrastructure, including ZeroFlap Active Electrical Cables, ZeroFlap optical transceivers, OmniConnect memory solutions, retimers and DSPs. Its customers include hyperscalers, NeoClouds, original equipment and design manufacturers, and optical module makers. Credo's fiscal year ends on the Saturday closest to April 30, and its latest annual period ended May 2, 2026.

First Quarter Fiscal 2027 Results

For the three months ended August 1, 2026, Credo reported revenue of USD 479.0 million, compared with USD 223.1 million in the same quarter a year earlier. Gross profit was USD 309.1 million against USD 150.4 million. Research and development expense was USD 114.5 million, and selling, general and administrative expense was USD 73.9 million.

GAAP net income was USD 129.4 million, or USD 0.67 per diluted share, compared with USD 63.4 million, or USD 0.34 per diluted share. Revenue from North America customers was 53% of the total, against 37% a year earlier, and the rest of the world was 47%.

On a non-GAAP basis, management said gross margin was 68%, operating income was USD 230.6 million and net income was USD 236.3 million. It said non-GAAP operating expenses were USD 95.2 million. These figures are non-GAAP measures and are reconciled in the company's earnings materials.

Cash, Acquisition and Customer Concentration

Cash and cash equivalents were USD 466.9 million at August 1, 2026, compared with USD 1.2 billion at May 2, 2026. Working capital was USD 1.3 billion, against USD 1.8 billion. The filing attributes investing activity mainly to a net cash payment of USD 735.6 million for the DustPhotonics acquisition. Short-term investments were USD 297.4 million, and inventories were USD 313.1 million.

Credo states that it derives the substantial majority of its revenue from a limited number of customers and expects that to continue for the foreseeable future. Management said on its call that it added a new customer above 10% of revenue in the quarter and still expects three to four such customers in the coming quarters.

Product Developments

Management described optical as a second growth engine alongside its active electrical cable portfolio. It said the DustPhotonics deal adds silicon photonics technology and cited two design wins for optical ramps in late fiscal 2027 and fiscal 2028.

It said it expects initial OmniConnect gearbox revenue in fiscal 2028 and plans to demonstrate Active LED Cable solutions at the Open Compute Project event in October, with initial revenue also in fiscal 2028. These are company statements about future products.

Outlook

For the second quarter of fiscal 2027, management guided revenue of USD 525 million to USD 535 million and non-GAAP gross margin of 67% to 69%. It guided non-GAAP operating expenses of USD 100 million to USD 105 million and a diluted weighted average share count of approximately 200 million shares. It said the guidance reflects the current tariff regime, which it described as fluid.

For the full year, management said it expects more than USD 600 million of optical revenue, with ZeroFlap optics, silicon photonics PICs and optical DSPs each contributing more than USD 100 million. It guided total revenue growth above 85% for the year, non-GAAP gross margin broadly consistent with fiscal 2026 and non-GAAP operating expense growth of approximately 55%. These are company expectations.