Credo Technology Group Holding Ltd Q1 FY2027 Earnings Call

· Earnings call transcript and AI-powered summary

Period: First quarter fiscal 2027 (ended ~June 2026). Strong performance driven by AI infrastructure demand, with 7 consecutive quarters of triple-digit YoY revenue growth. Focus on connectivity solutions (AECs, optics, retimers) for hyperscalers and Neo Cloud customers.

Financial Highlights

  • Revenue: $479 million (record high) — +10% sequentially from Q4 FY2026; +115% YoY from Q1 FY2026. Driven by growth across 4 domestic customers.
  • Non-GAAP Gross Margin: 68% (midpoint of guidance).
  • Non-GAAP Operating Income: $230.6 million — +6% sequentially from $216.7 million in Q4 FY2026; operating margin 48.2%.
  • Non-GAAP Net Income: $236.3 million (record) — +4% sequentially from $226.7 million in Q4 FY2026; +140% YoY. Net margin 49.3%.
  • Cash Flow: Operating cash flow $90.2 million (down $92 million sequentially due to working capital changes); free cash flow $82.9 million.
  • Balance Sheet: Cash and equivalents $764.3 million (down from Q4 due to Dust Photonics acquisition); inventory $313.1 million (+$62.2 million sequentially).
  • Customer Concentration: Top 4 customers each ≥10% of revenue (33%, 28%, 13%, 10%). Expect 3-4 customers >10% going forward; diversifying across hyperscalers and Neo Clouds.

Business Updates & Segment Performance

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Operator: Ladies and gentlemen, thank you for standing by. At this time, all participants are in a listen-only mode. Later, we will conduct a question and answer session. Where we request that you please limit yourself to 1 question only. At that time, if you have a question, you will need to press star followed by the number 1 on your telephone keypad. If you would like to withdraw your question, press star 1 again. I would now like to turn the conference over to Daniel O'Neil Treasurer and VP of Investor Relations. Please go ahead, sir. Daniel J. O'Neil: Good afternoon. Thank you all for joining our first quarter fiscal 27 earnings call. Today, I am joined by Bill Brennan, Credo's Chief Executive Officer and Daniel Fleming, Credo's Chief Financial Officer. During this call, we will make certain forward-looking statements. These forward-looking statements are subject to risks and uncertainties discussed in detail in our documents filed with the SEC. These documents can be found in the Investor Relations portion of the company's website. It is not possible for the company's management to predict all risks, nor can the company assess the impact of all factors on its business. Or the extent to which any factor or combination of factors may cause actual results to differ materially from those contained in any forward-looking statement. Given these risks, uncertainties, and assumptions, the forward looking events discussed during this call may not occur. And actual results could
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