Credo to Acquire DustPhotonics for $750M, Targets $500M Optical Revenue in FY2027
Credo Technology will acquire DustPhotonics for $750 million cash and 0.92 million shares, expecting over $500 million in optical revenue in fiscal 2027 and accretion to adjusted EPS. Jefferies initiated coverage with a Buy rating and $175 price target, implying 46% upside.
1. Acquisition Deal Details
Credo Technology agreed to acquire DustPhotonics for $750 million in cash plus 0.92 million shares, with the transaction expected to close in Q2 2026 and bring silicon photonics capabilities in-house.
2. Financial Impact and Projections
The combined company targets more than $500 million in optical revenue in fiscal 2027, with the deal anticipated to be accretive to adjusted EPS in that year.
3. Analyst Re-Rating
Jefferies initiated coverage with a Buy rating and a $175 price target, highlighting growth prospects in AI data center connectivity through active electrical cables and a $300 million-plus transceiver opportunity via ZeroFlap Optics.