Group 1: Stock Movements and Market Reactions - JunDa Co., Ltd. (02865) fell by 12.69% due to weak fundamentals, expected shareholder sell-off, and cash flow concerns [1] - Rongchang Biopharmaceutical (09995) rose by 4.61% after ASCO announced positive data for RC108 combined with vorinostat, enhancing its commercialization prospects [1] - Datang Gold (08299) increased by 7.27% as it partnered with Wuxi to develop AI mining applications, benefiting from gold's safe-haven demand [1] - Kanglong Chemical (03759) gained 4.35% by investing in a biopharmaceutical fund, strengthening its investment ecosystem [1] - Automotive stocks surged following a significant increase in May's new energy vehicle sales, with Li Auto (2015) rising nearly 6% and Great Wall Motors (2333) up over 3% [1] - Gold stocks led the market as COMEX gold prices returned to $3,400, with Goldman Sachs predicting $4,200, driven by geopolitical tensions [1] Group 2: Company-Specific Developments - Changfei Optical Fiber (06869) rose by 8.34% as its Wuhan base began mass production of 6-inch silicon carbide wafers, achieving a 97% yield rate [2] - China Shipbuilding Defense (00317) increased by 7.58% after securing the highest global new orders from January to April, with Q1 net profit up 1,099% [2] - Hengrui Medicine (00013) rose by 5.09% as SACHI III phase data met expectations, opening up market space for MET amplification lung cancer treatment [2] - Lepu Medical Technology (02157) gained 5.76% following positive ASCO data for its ADC drug MRG003, boosting approval expectations for nasopharyngeal carcinoma [2] - Aidi Kang Holdings (09860) increased by 5.2% after acquiring Suzhou Yuande Youqin to enhance blood disease diagnostics [2] - NetDragon (00777) rose by 5.82% due to its collaboration with Thailand on an AI education platform, attracting investor interest [2] Group 3: Notable Market Trends - China Everbright Holdings (00165) surged over 21% following the enactment of Hong Kong's stablecoin regulations, with Circle's IPO expectations boosting related equity valuations [3] - iFlytek Medical (02506) rose by 6.62% as its medical AI model demonstrated superior accuracy, supported by favorable policies [3] - MicroPort NeuroTech (02172) increased by 9.59% as it initiated clinical research on brain-machine interfaces, benefiting from policy incentives [3] - Longpan Technology (02465) rose by 14.9% after its subsidiary signed a $7.1 billion contract with Yiwei Lithium Energy for lithium iron phosphate [4] - Hansoh Pharmaceutical (03692) gained 3.85% after reaching a global licensing agreement with Regeneron, receiving an $80 million upfront payment [4] Group 4: U.S. Market Highlights - Steel and aluminum stocks surged over 10%-28% as Trump proposed increasing steel tariffs to 50%, benefiting domestic companies [5] - Blueprint Medicines (BPMC.US) rose by 26% following Sanofi's $9.1 billion acquisition, enhancing its rare disease pipeline [5] - BioNTech (BNTX.US) increased by 18% due to a collaboration with Bristol-Myers Squibb, securing a $1.5 billion upfront payment [5] - Applied Digital (APLD.US) surged by 48.46% after signing a $7 billion AI data center lease, validating its business model [5] - Tempus AI (TEM.US) rose by 15% as it launched an AI medical innovation plan, attracting investor interest [7]

Core Viewpoint - Credo Technology Group Holding Ltd. reported quarterly earnings of $0.35 per share, exceeding the Zacks Consensus Estimate of $0.27 per share, and showing significant growth from $0.07 per share a year ago, indicating strong performance in the semiconductor industry [1][2]. Financial Performance - The company achieved revenues of $170.03 million for the quarter ended April 2025, surpassing the Zacks Consensus Estimate by 6.27%, and showing a substantial increase from $60.78 million in the same quarter last year [2]. - Over the last four quarters, Credo Technology has exceeded consensus EPS estimates three times and topped revenue estimates four times [2]. Stock Performance - Credo Technology Group shares have declined approximately 9.3% since the beginning of the year, contrasting with the S&P 500's gain of 0.5%, indicating underperformance relative to the broader market [3][4]. Earnings Outlook - The current consensus EPS estimate for the upcoming quarter is $0.27 on revenues of $162.3 million, and for the current fiscal year, it is $1.08 on revenues of $671.35 million [7]. - The estimate revisions trend for the company is mixed, resulting in a Zacks Rank 3 (Hold), suggesting that shares are expected to perform in line with the market in the near future [6]. Industry Context - The Electronics - Semiconductors industry, to which Credo Technology belongs, is currently ranked in the top 37% of over 250 Zacks industries, indicating a favorable outlook compared to lower-ranked industries [8].

Financial Data and Key Metrics Changes - In Q4, the company reported revenue of $170 million, a 26% sequential increase and up 180% year over year [5][23] - For fiscal year 2025, total revenue reached $437 million, representing a growth of 126% year over year [6][22] - Non-GAAP gross margin for Q4 was 67.4%, and for fiscal year 2025, it was 65%, reflecting an increase of 257 basis points year over year [6][22] - Non-GAAP operating income in Q4 was $62.5 million, compared to $42.4 million in Q3, indicating significant leverage from revenue growth [25] Business Line Data and Key Metrics Changes - The Active Electrical Cable (AEC) product line maintained a steep growth trajectory, with significant contributions from three hyperscalers, each contributing over 10% of revenue [10][24] - The optical business achieved strong momentum, with revenue growth targets met, including a significant win for an 800 gig transceiver expected to deploy in fiscal 2026 [13][14] - The retimer business also showed robust results, driven by 50 gig and 100 gig per lane Ethernet solutions, reflecting growing adoption in AI-driven architectures [17][18] Market Data and Key Metrics Changes - The company anticipates increasing customer diversification across copper and optical connectivity for various applications in AI networks [10][21] - The demand for high-speed connectivity solutions is expected to continue growing among hyperscaler customers, driven by advanced AI services [21] Company Strategy and Development Direction - The company is focused on customer-driven innovation and has successfully capitalized on a predicted inflection point in demand for high-performance connectivity solutions [7][8] - The strategy includes a holistic innovation approach that integrates advanced technology, integrated circuit design, and system-level solutions [9][10] - The company aims to capture significant opportunities in the global AI infrastructure investment wave, positioning itself for sustained growth [20] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in sustained revenue growth driven by strong customer forecasts and new design wins [12][19] - The company expects revenue for Q1 of fiscal 2026 to be between $185 million and $195 million, with year-over-year growth exceeding 85% anticipated for the full year [27][28] - Management highlighted the importance of flexibility in navigating tariff risks and the evolving macroeconomic environment [56] Other Important Information - The company ended Q4 with cash and equivalents of $431.3 million, an increase of $52.1 million from Q3, indicating strong financial health [26] - CapEx for Q4 was $3.7 million, primarily for production equipment purchases, with expectations for CapEx to double in fiscal 2026 to support growth [26][82] Q&A Session Summary Question: Can you quantify the revenue contribution from the largest customers? - The largest customer accounted for 61% of revenue, with two others contributing 12% and 11% respectively, and diversification is expected to continue in fiscal 2026 [34][35] Question: What are the expectations for gross margin in fiscal 2026? - Gross margin is expected to be at or above the high end of the long-term model, with guidance for Q1 set at 65% [36][38] Question: Can you discuss the use cases for large customers, especially regarding AEC? - The main use cases include connecting servers with switches, with a significant focus on scale-out networks [44][45] Question: What is the competitive landscape for AEC products? - The competitive environment has not changed significantly, and the company aims to maintain its leadership by delivering innovative solutions quickly [88][90] Question: What are the expectations for scale-up revenues? - Design wins are expected to materialize in calendar 2026, with significant growth anticipated in the following years [79] Question: Are there any supply chain bottlenecks? - The company has shown the ability to ramp production quickly, with lead times primarily affected by silicon supply [102]

Financial Data and Key Metrics Changes - In Q4, the company reported revenue of $170 million, a 26% sequential increase and up 180% year over year [5][23] - For fiscal year 2025, total revenue reached $437 million, representing a growth of 126% year over year [6][22] - Non-GAAP gross margin for Q4 was 67.4%, and for fiscal year 2025, it was 65% [6][22] - Non-GAAP operating income in Q4 was $62.5 million, compared to $42.4 million in Q3, reflecting significant leverage from revenue growth [25] Business Line Data and Key Metrics Changes - The Active Electrical Cable (AEC) product line maintained a steep growth trajectory, with significant contributions from three hyperscalers, each contributing over 10% of revenue in Q4 [10][24] - The optical business achieved strong momentum, with revenue growth targets met, including a significant win for an 800 gig transceiver expected to deploy in fiscal 2026 [13][14] - The retimer business also showed robust results, driven by 50 gig and 100 gig per lane Ethernet solutions, with expectations for strong growth in fiscal 2026 [17][18] Market Data and Key Metrics Changes - The company anticipates increasing customer diversification across copper and optical connectivity for various applications, particularly in AI networks [10][21] - The demand for high-speed connectivity solutions is expected to continue growing among hyperscaler customers [21] Company Strategy and Development Direction - The company is focused on customer-driven innovation and has successfully capitalized on a predicted inflection point in demand for high-performance connectivity solutions [8][19] - The strategy includes a holistic innovation approach that integrates advanced technology, system-level solutions, and a robust software platform [9][10] - The company aims to capture significant opportunities in the global AI infrastructure investment wave, positioning itself for sustained growth [20] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in sustained revenue growth driven by strong customer forecasts and new design wins [12][19] - The company expects revenue for Q1 of fiscal 2026 to be between $185 million and $195 million, with a year-over-year growth expectation exceeding 85% for the full year [27][28] - Management highlighted the importance of flexibility in navigating tariff risks and the evolving macroeconomic environment [56] Other Important Information - The company ended Q4 with cash and equivalents of $431.3 million, an increase of $52.1 million from Q3, indicating strong financial health [26] - CapEx for Q4 was $3.7 million, with expectations for CapEx to double in fiscal 2026 to support growth initiatives [22][82] Q&A Session Summary Question: Can you quantify the revenue contribution from the largest customers? - The largest customer accounted for 61% of revenue, with two others contributing 12% and 11% respectively, and diversification is expected to continue in fiscal 2026 [34][35] Question: What are the expectations for gross margin and EBIT margin? - Gross margin is expected to be around 65% for Q1, with EBIT margin expected to follow improvements in net margin [36][39] Question: Can you discuss the use cases for large customers, especially regarding AEC? - The main use cases include connecting servers with switches, with a significant focus on scale-out networks [44][45] Question: What is the competitive landscape for AEC products? - The competitive environment remains stable, with the company focused on delivering innovative solutions quickly to maintain leadership [88] Question: How is the company positioned for optical growth? - The company expects to double or exceed its optical revenue in fiscal 2026, with strong traction in 100 gig per lane designs [69][70] Question: Are there any supply chain bottlenecks? - The company has shown the ability to ramp production quickly, with silicon lead times being the longest, but overall supply chain management is strong [101][103]

Financial Data and Key Metrics Changes - In Q4, the company reported revenue of $170 million, a 26% sequential increase and up 180% year over year [4][22] - For fiscal year 2025, total revenue reached $437 million, representing a growth of 126% year over year [5][21] - Non-GAAP gross margin for Q4 was 67.4%, and for fiscal year 2025, it was 65% [5][21] - Non-GAAP operating income in Q4 was $62.5 million, compared to $42.4 million in Q3, reflecting significant leverage from revenue growth [24] Business Line Data and Key Metrics Changes - The Active Electrical Cable (AEC) product line maintained a steep growth trajectory, with significant contributions from three hyperscalers, each contributing over 10% of revenue [9][22] - The optical business achieved strong momentum, with revenue growth targets met and significant wins in 50 gig and 100 gig per lane optical DSPs [12][15] - The retimer business also delivered robust results, driven by 50 gig and 100 gig per lane Ethernet solutions [15] Market Data and Key Metrics Changes - The company noted increasing customer diversification across copper and optical connectivity for various applications, particularly in AI networks [8][20] - The demand for high-speed connectivity solutions is growing among hyperscaler customers, driven by the need for advanced AI services [20] Company Strategy and Development Direction - The company is focused on customer-driven innovation and has positioned itself as a leader in high-speed connectivity solutions, particularly in the AI landscape [6][18] - The strategy includes expanding the AEC market and enhancing optical connectivity solutions, with a commitment to energy efficiency and reliability [14][19] - The company anticipates significant growth opportunities in the optical market, particularly with the introduction of new products [14][19] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in sustained revenue growth, driven by increasing customer diversification and the anticipated ramp-up of new hyperscale customers [9][33] - The company expects revenue for Q1 of fiscal 2026 to be between $185 million and $195 million, indicating a 12% sequential growth at the midpoint [26] - For fiscal year 2026, the company projects revenue to exceed $800 million, with year-over-year growth exceeding 85% [27] Other Important Information - The company ended Q4 with cash and equivalents of $431.3 million, an increase of $52.1 million from Q3 [25] - Capital expenditures (CapEx) are expected to double in fiscal year 2026 to support growth initiatives [78] Q&A Session Summary Question: Can you quantify the contribution of the largest customers? - The largest customer accounted for 61% of revenue, with two others contributing 12% and 11% respectively [32] Question: What are the expectations for gross margin in the upcoming quarters? - Gross margin is expected to trend around 65% for Q1, with potential for further expansion as scale increases [34][36] Question: Can you elaborate on the use cases for large customers? - The primary use cases include connecting servers with switches, focusing on both front-end and back-end networks [42] Question: What is the competitive landscape for AEC products? - The competitive environment has not changed significantly, and the company aims to maintain its leadership by delivering innovative solutions quickly [84][86]

Financial Performance - Credo reported a record revenue of $436.8 million for fiscal year 2025, representing a 126% increase year over year[2]. - In Q4 2025, revenue reached $170.0 million, growing by 25.9% quarter over quarter and 179.7% year over year[4]. - GAAP net income for Q4 2025 was $36.6 million, with a GAAP diluted net income per share of $0.20[4]. - For Q1 2026, revenue is expected to be between $185.0 million and $195.0 million[5]. - Non-GAAP net income for the year ended May 3, 2025, reached $129,926 thousand, significantly higher than $14,570 thousand in the previous year[21]. - GAAP gross profit for the three months ended May 3, 2025, was $114,188 thousand, compared to $39,966 thousand for the same period last year, reflecting a 185.5% increase[21]. - Non-GAAP operating income for the three months ended May 3, 2025, was $62,523 thousand, compared to $7,462 thousand in the same period last year, a 737.5% increase[21]. Expenses and Margins - Research and development expenses for Q4 2025 were $47.6 million, up from $36.3 million in the previous quarter[17]. - Total operating expenses for Q4 2025 were $80.4 million, compared to $59.7 million in Q3 2025[17]. - GAAP gross margin for Q1 2026 is projected to be between 63.4% and 65.4%[5]. - Non-GAAP gross margin is projected to be between 64.0% and 66.0% for the three months ending August 2, 2025[22]. - Total GAAP operating expenses for the year ended May 3, 2025, were $245,785 thousand, up from $156,489 thousand, indicating a 57.0% increase[21]. - GAAP operating income margin improved to 19.9% for the three months ended May 3, 2025, compared to a loss margin of (13.0)% in the same period last year[21]. Assets and Liabilities - The company ended Q4 2025 with a cash and short-term investment balance of $431.3 million[4]. - Total assets increased to $809,257 thousand, up from $601,932 thousand, representing a 34.4% growth year-over-year[19]. - Total current assets rose to $713,534 thousand, an increase of 34.5% from $530,265 thousand year-over-year[19]. - Cash and cash equivalents increased to $236,328 thousand, compared to $66,942 thousand, marking a 253.5% rise year-over-year[19]. - Total liabilities decreased to $127,675 thousand from $61,734 thousand, a reduction of 51.5% year-over-year[19]. Market Outlook - The company anticipates continued demand for its high-performance connectivity solutions, particularly from hyperscaler customers[2]. - Credo's innovative solutions are aimed at supporting the growing needs of AI, cloud computing, and hyperscale networks[14].

Core Insights - Credo Technology (NASDAQ: CRDO) is set to announce its earnings on June 2, 2025, with historical data indicating a nearly equal probability of stock price movement post-announcement [1][2] - Analysts expect earnings of $0.27 per share on revenues of $159.59 million, a significant increase from the previous year's earnings of $0.07 per share on sales of $60.78 million [2] - The company has a market capitalization of $10 billion and generated $328 million in revenue over the past year, reporting an operating loss of $3.8 million but a net income of $5.1 million [2] Earnings Reaction History - Over the past five years, there have been 13 earnings data points for CRDO, with 7 positive and 6 negative one-day returns, resulting in a 54% occurrence of positive returns [5] - The median one-day return for positive outcomes was 23%, while the median for negative returns was -6.4% [5] - The percentage of positive returns increases to 58% when considering the last three years [5] Post-Earnings Positioning - Historical trends suggest that traders can benefit from understanding the correlation between short-term (1D) and medium-term (5D) returns after earnings announcements [3][4] - A strategy involves taking a position ahead of the earnings report based on historical probabilities and adjusting positions based on immediate and medium-term returns post-announcement [4] Correlation with Peer Earnings - The performance of peer companies can influence CRDO's stock reaction following earnings announcements, with pricing adjustments potentially occurring before the announcements [6]

Group 1 - Credo Technology Group Holding Ltd. (NASDAQ: CRDO) is recognized as a strong AI stock with Strong Buy ratings from Wall Street and Quant [1] - The company is experiencing significant momentum, indicating positive market sentiment and potential for growth [1] - The analysis emphasizes the importance of focusing on high-quality names with reasonable valuations rather than seeking deep discounts [1] Group 2 - The investor's approach combines hands-on experience with an academic background in corporate finance, highlighting a strategic perspective on investment opportunities [1] - There is a focus on balancing growth opportunities with low-volatility dividend-paying stocks to create a well-rounded investment portfolio [1] - The analysis prioritizes fundamental business performance and strategic perspectives as key factors in evaluating companies [1]

Group 1 - Credo Technology's shares have increased approximately 50% since early March, indicating strong market performance [2] - The Growth Stock Forum provides a model portfolio of 15-20 stocks, a top picks list of up to 10 stocks, and trading ideas for both short-term and medium-term strategies [2] - The forum encourages investors to join by June 9 to secure current rates before a price increase [1] Group 2 - The article reflects the author's personal opinions and does not constitute investment advice or recommendations [3][4] - The author has a beneficial long position in ALAB shares, indicating a vested interest in the stock [3]

Core Viewpoint - The article emphasizes the importance of quantitative methods in identifying undervalued stocks across various industries, suggesting that numerical data often provides a clearer picture of a company's potential than narrative descriptions [1]. Group 1 - The company employs backtested quantitative methods to search for undervalued stocks of any size [1]. - The analyst has been investing since 2013 and has gained knowledge from extensive reading of stock market literature [1]. - The focus is on the significance of numbers over stories in assessing a company's prospects [1].