10-QPeriod: Q2 FY2026

Credo Technology Group Holding Ltd Quarterly Report for Q3 Ended Nov 1, 2025

Filed December 2, 2025For Securities:CRDO

Summary

Credo Technology Group Holding Ltd reported a strong financial performance for the six months ended November 1, 2025, showcasing significant year-over-year growth. Total revenue more than tripled to $491.1 million, primarily driven by a substantial increase in product sales, particularly Active Electrical Cables (AECs) to hyperscale data center customers. The company also achieved profitability, with net income reaching $146.0 million for the period, a stark contrast to the net loss reported in the prior year. Financially, Credo strengthened its balance sheet with a significant increase in cash and cash equivalents to $567.6 million, bolstered by a successful At-The-Market (ATM) offering that raised $384.6 million in net proceeds. The company also completed a strategic acquisition of Hyperlume, Inc., aimed at expanding its microLED technology portfolio for chip-to-chip communication, adding goodwill and intangible assets to its balance sheet. Despite increased operating expenses related to growth and share-based compensation, the company maintained a healthy gross margin of 67.5% and demonstrated improved operating leverage.

Financial Highlights

45 data points
Beta

Revenue

$223.07M

67.4% Gross Margin

Net Income

$63.40M

28.4% Net Margin

EPS (Diluted)

$0.34

Total Assets

$905.17M

Cash & Equivalents

$219.64M

Free Cash Flow

$51.35M

Financial Statements
Beta
Revenue$223.07M
Cost of Revenue$72.71M
Gross Profit$150.37M
R&D Expenses$52.45M
SG&A Expenses$37.18M
Operating Expenses$89.63M
Operating Income$60.74M
Net Income$63.40M
EPS (Basic)$0.37
EPS (Diluted)$0.34
Shares Outstanding (Basic)171.93M
Shares Outstanding (Diluted)184.58M

Key Highlights

  • 1Total revenue surged by 272.8% year-over-year to $491.1 million for the six months ended November 1, 2025.
  • 2The company achieved significant profitability, reporting a net income of $146.0 million for the six months ended November 1, 2025, compared to a net loss of $13.8 million in the prior year.
  • 3Cash and cash equivalents significantly increased to $567.6 million as of November 1, 2025, supported by $384.6 million in net proceeds from an At-The-Market (ATM) offering.
  • 4Gross margin improved to 67.5% for the six-month period, reflecting improved economies of scale in product sales.
  • 5Credo completed the acquisition of Hyperlume, Inc. for $92.0 million to enhance its microLED optical interconnect technology capabilities.
  • 6Research and Development (R&D) and Selling, General & Administrative (SG&A) expenses increased significantly year-over-year, reflecting investments in growth and share-based compensation.
  • 7The company's customer concentration remains high, with specific customers accounting for substantial portions of revenue and accounts receivable.

Frequently Asked Questions

The substantial increase in revenue, particularly product sales, was primarily driven by the ramp-up of Credo's Active Electrical Cable (AEC) solutions at hyperscale data center customers. Unit shipments of AEC products contributed over 95% of the increase in product sales revenue.

Credo has transitioned from a net loss in the prior year to significant profitability. For the six months ended November 1, 2025, the company reported a net income of $146.0 million, a substantial improvement from a net loss of $13.8 million in the same period last year. This is attributed to increased revenue, improved gross margins, and a shift in operating income from a loss to a gain.

Credo acquired Hyperlume, Inc. for $92.0 million to expand its microLED optical interconnect technology portfolio. This acquisition resulted in the recognition of $69.1 million in goodwill and $17.2 million in intangible assets on the balance sheet as of November 1, 2025. The purchase price allocation is preliminary and subject to further adjustments.

Credo's liquidity has been significantly strengthened. Cash and cash equivalents increased to $567.6 million as of November 1, 2025, up from $236.3 million at May 3, 2025. This increase was largely due to the $384.6 million in net proceeds raised from an At-The-Market (ATM) equity offering during the period.