Credo Technology Group (NASDAQ:CRDO) delivered stronger-than-expected quarterly results, benefiting from the ongoing surge in investment tied to large-scale artificial intelligence infrastructure projects.

The upbeat report sent the stock soaring more than 17% in U.S. premarket trading on Tuesday.

The data-center connectivity specialist reported fiscal second-quarter revenue of $268 million, exceeding the consensus estimate of $234.67 million. Adjusted diluted earnings per share reached $0.67, well above the $0.49 analysts had projected.

Sales climbed 20% compared with the prior quarter and were up 272% year over year.
Credo ended the period with $813.6 million in cash and short-term investments.

CEO Bill Brennan said the company had delivered the strongest quarter in its history, pointing to ongoing spending on major AI training and inference clusters.

He also emphasized that momentum across its core product lines — including active electrical cables, ZeroFlap Optics, ALCs, and OmniConnect gearboxes — supports expectations for robust “revenue growth and profitability through fiscal 2026 and beyond.”

For the current quarter, Credo expects revenue between $335 million and $345 million. The company projects unadjusted gross margins of 63.8% to 65.8% and adjusted gross margins of 64% to 66%.

Unadjusted operating expenses are forecast at $116 million to $120 million, with adjusted operating expenses expected to fall in the $68 million to $72 million range.

Analysts at Stifel addressed recent market concerns about the durability of AI-driven spending, writing: “While recent weeks have presented investor skepticism around the sustainability of AI spend and elevated valuation levels, we continue to believe that the proliferation of rack level AI infrastructure is still in its early innings.”

They added: “Further, we believe networking is the most important part of this market, and we view Credo as a clear leader in multiple subsegments of this market.”

Credo Technology Group Holding stock price

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