Credo has reported a significant increase in demand for its Active Electrical Cables (AECs), driven by hyperscale data center operators ramping up AI and cloud workloads. In the most recent quarter, AEC shipments accounted for approximately 20% of the company’s overall 272% year-over-year revenue growth, underscoring their role in delivering lower-latency, energy-efficient links between switch ASICs and optical modules. Management highlighted that these sales gains were supported by design wins at three leading cloud service providers and two major networking equipment OEMs, positioning Credo to capture an estimated $500 million annual market opportunity as switch port speeds accelerate to 800G and 1.6T.

As of the latest fiscal close, Credo held $813.6 million in cash and short-term investments, a balance that provides considerable flexibility for R&D, strategic M&A and scaling of its AI-optimized SerDes platform. The company has earmarked roughly $150 million over the next 12 months for targeted acquisitions in high-speed optical interconnect and complementary IP licensing businesses. This war chest also supports accelerated hiring across its firmware and system-level engineering teams, with headcount expected to grow by 25% year-over-year.

Credo’s operational discipline translated into significant margin improvement last quarter, with adjusted gross margins expanding by 850 basis points to 53.5% and non-GAAP operating income reaching 18.2% of revenue. Adjusted EPS jumped 857% year-over-year, reflecting both disciplined cost control and higher average selling prices on next-generation 400G and 800G SerDes ICs. For the upcoming quarter, management’s guidance implies 152% year-over-year revenue growth and further gross margin expansion, supported by continued scaling in high-value port speeds.

Credo’s executive team will provide a business update at the 28th Annual Needham Growth Conference on Wednesday, January 14, 2026 at 9:30 a.m. ET in New York City. Bill Brennan, President and CEO, and Dan Fleming, CFO, are scheduled to discuss the company’s multi-year roadmap for AI connectivity solutions and the expanding addressable market, with a live webcast available on Credo’s investor relations site. Investors will have the opportunity to submit questions following the presentation.