Credo Sequential Revenue Growth Slows to 9.6%
The connectivity maker guided second-quarter fiscal 2027 sales to $525 million to $535 million.
Credo Technology Group Holding Ltd (CRDO), a designer of high-speed copper and optical interconnects for data centers, reported first-quarter fiscal 2027 revenue of $479.0 million, up 9.6% from the prior quarter and 114.7% from a year earlier.
That sequential pace marked a further step-down from 7.4% growth in the quarter ended May 2, 2026, after 51.9% growth two quarters earlier. Year-over-year growth also cooled, from 157.0% in the immediately preceding quarter and 201.5% two quarters before.
GAAP gross margin compressed to 64.5% from 68.2% in the prior quarter, after reaching 68.5% two quarters earlier. Non-GAAP gross margin slipped to 68.0% from 68.3%.
GAAP operating expenses rose to $188.4 million from $142.2 million, and non-GAAP operating expenses rose to $95.2 million from $81.7 million. Research and development was $114.5 million; selling, general and administrative expenses were $73.9 million.
GAAP operating income fell to $120.7 million from $155.8 million, and GAAP operating margin compressed to 25.2% from 35.7%. Non-GAAP operating income rose to $230.6 million from $216.7 million; non-GAAP operating margin slipped to 48.2% from 49.6%.
GAAP net income declined to $129.4 million from $169.1 million, and GAAP diluted earnings fell to $0.67 a share from $0.88. Non-GAAP net income rose to $236.3 million from $226.7 million, and non-GAAP diluted earnings rose to $1.20 a share from $1.16.
The GAAP-to-non-GAAP bridge included $11.0 million of amortization of acquired intangible assets in the gross-profit reconciliation, versus none in the prior quarter, and $10.4 million of acquisition and integration-related costs, versus $9.3 million.
On the balance sheet, goodwill rose to $986.4 million from $92.8 million at the May 2 close, and intangible assets, net, rose to $378.8 million from $29.3 million. Cash and cash equivalents fell to $466.9 million from $1.165 billion. Ending cash and short-term investments were $764.3 million, versus $1.4 billion in the prior quarter.
President and Chief Executive Officer Bill Brennan said the portfolio now spans connectivity from millimeters to kilometers, with solutions across optics and copper, and that as AI infrastructure scales, the company will continue to provide connectivity solutions for the data center.
Credo expects second-quarter fiscal 2027 revenue of $525 million to $535 million, versus the $465 million to $475 million range it had issued for the quarter just reported. GAAP gross margin is expected at 62.9% to 64.9%, and non-GAAP gross margin at 67.0% to 69.0%. GAAP operating expenses are expected at $199 million to $204 million, and non-GAAP operating expenses at $100 million to $105 million.