Credo (CRDO) Fiscal Q1 2027 Earnings Call: Revenue Jumps 115% as Optics Accelerates
Source Tradingkey
Key Takeaways
- Credo reported record fiscal Q1 2027 revenue of $479 million, up 10% sequentially and 115% year over year. This was its seventh consecutive quarter of triple-digit year-over-year revenue growth.
- Non-GAAP gross margin was 68%, while non-GAAP operating margin reached 48.2%. Non-GAAP net income rose 140% year over year to a record $236.3 million.
- Active Electrical Cables remained Credo’s largest business, supported by relationships with five hyperscalers and expanding engagement with neo-cloud customers. Optical DSP and retimer revenue also reached records.
- Management expects fiscal Q2 revenue of $525 million to $535 million and a non-GAAP gross margin of 67% to 69%.
- Credo maintained its fiscal 2027 outlook for more than 85% total revenue growth and over $600 million of optical revenue. ZeroFlap Optics, silicon photonics PICs and optical DSPs are each expected to contribute more than $100 million.
- Customer concentration remains significant. Credo’s four largest customers represented approximately one-third, 28%, 13% and 10% of quarterly revenue, respectively.
Core Financial Results
| Metric | Fiscal Q1 2027 | Change / Commentary |
|---|---|---|
| Revenue | $479 million | Up 10% QoQ and 115% YoY |
| Non-GAAP gross margin | 68% | At the midpoint of guidance |
| Non-GAAP operating expenses | $95.2 million | Up 16% QoQ, reflecting higher R&D investment |
| Non-GAAP operating income | $230.6 million | Up from $216.7 million in fiscal Q4 2026 |
| Non-GAAP operating margin | 48.2% | Continued operating leverage despite R&D spending |
| Non-GAAP net income | $236.3 million | Up 4% QoQ and 140% YoY |
| Non-GAAP net margin | 49.3% | Record quarterly net income |
| Operating cash flow | $90.2 million | Down $92.0 million QoQ, mainly due to working-capital changes |
| Capital expenditure | $7.3 million | — |
| Free cash flow | $82.9 million | — |
| Cash and equivalents | $764.3 million | Down $679 million QoQ, mainly due to the DustPhotonics acquisition |
| Ending inventory | $313.1 million | Up $62.2 million QoQ |
Business and Operating Performance
AEC remains the largest business
Disclaimer: For information purposes only. Past performance is not indicative of future results.
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