Credo Technology Shares Are Soaring Today: What's Driving The Momentum?

Credo Technology Group Holding Ltd. CRDO are trading higher Tuesday after the company reported better-than-expected fourth-quarter results and issued strong guidance for the upcoming quarter.

What To Know: The company posted revenue of $170.03 million for the fourth quarter of fiscal 2025, exceeding analyst expectations of $162.96 million. Adjusted earnings came in at 35 cents per share, beating the consensus estimate of 28 cents per share.

Revenue was up nearly 180% year-over-year and increased 26% from the previous quarter. Gross margin for the quarter came in at 67.4%. Credo ended the period with over $431 million in cash and short-term investments. The company attributed the strong results to growing demand for its high-performance connectivity products, particularly from hyperscaler customers deploying AI-driven infrastructure.

For the first quarter of fiscal 2026, Credo expects revenue between $185 million and $195 million, well above estimates of $167.83 million. The company also guided for an adjusted gross margin between 64% and 66%, suggesting continued operating strength despite rising costs across the tech sector.

Following the earnings report, several analysts raised their price targets on the stock. Needham, Barclays, Susquehanna and Stifel all reaffirmed bullish ratings and increased their forecasts, with targets now ranging from $80 to $90.

The sharp move in Credo's stock price reflects investor optimism over the company’s positioning in the connectivity solutions space. As demand continues to grow for energy-efficient and scalable data connectivity solutions, Credo's technology appears well aligned with current market trends.

“We continue to see growing demand for our solutions across hyperscaler customers to power advanced AI services, a trend we believe will persist for the foreseeable future,” said Bill Brennan, president and CEO of Credo Technology Group.

CRDO Price Action: Credo shares were up 15.5% at $72.25 at the time of publication Tuesday, according to Benzinga Pro.

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