Beyond tonight’s headline numbers, Credo has posted 8 consecutive EPS beats, with EPS surprises averaging roughly 26% and revenue surprises averaging near 9% across the past four quarters.
The largest recent beat landed in Q1 FY26 at 44.2%, and the most recent quarter delivered 12.17% upside. Guidance has skewed conservative: management guided Q3 FY26 revenue to $335-345M and delivered $407M; the prior quarter’s $230-240M range came in at $268M.
CEO Bill Brennan stayed on message around hyperscaler partnerships and optical TAM, noting fiscal 2026 revenue “more than tripled to $1.3 billion.”
With a $465-475M Q1 guide on the table, the pattern hints at room above the high end, though the setup leaves little cushion if the streak breaks.
Wall Street already expects Q2 revenue of $514.7 million and EPS of $1.2552, with 4 upward revisions in the past 30 days.
Management typically guides conservatively, then beats. Revenue beats have narrowed from 17.02% in Q1 FY26 to 0.86% in Q4 FY26 as scale grows. The prior framework calls for FY27 revenue growth above 80% and a non-GAAP net margin near 50%.
Credo Technology reports Q1 FY27 earnings after the bell, with consensus calling for $470.38 million in revenue and $1.1651 in EPS.
Management expects its optical portfolio to generate more than $600 million in fiscal 2027 revenue, with the business weighted toward the second half as hyperscalers continue building increasingly connectivity-intensive AI infrastructure.
But two risks could determine how investors react tonight: gross margins and customer concentration. New optical products could pressure the company’s mix even as its AEC franchise continues to scale, while heavy hyperscaler exposure leaves results sensitive to spending from a relatively small group of customers.
Credo trades around 40 times forward earnings and carries a 3.2 beta, leaving little room for disappointment. A strong beat, paired with a reaffirmed second-half optical ramp, could keep the AI connectivity thesis intact.
This article is updated throughout the trading day. Check back for more.
Credo (NASDAQ:CRDO | CRDO Price Prediction) is expected to report Q1 FY2027 results today after the market closes at 4:05 PM ET. Shares slid 5.51% intraday to $213.61 ahead of the report, tightening the risk band around a stock up 57.2% year to date.
For Q4, revenue landed at $437 million, up 157.02% year over year, with non-GAAP EPS of $1.16 beating consensus by 12.17%. Non-GAAP gross margin came in at 68.3%, well above the 64.0% to 66.0% guide.
For the full year, revenue more than tripled to $1.3 billion, and non-GAAP net income rose more than five times to $662 million. Cash and equivalents closed at $1.4 billion after $177.5 million of free cash flow in Q4 alone. Management guided Q1 revenue to $465.0 million to $475.0 million with non-GAAP gross margin of 67.0% to 69.0%.
| Metric | Q1 FY27 Estimate | YoY Change | FY 2027 Estimate | FY 2028 Estimate |
|---|---|---|---|---|
| Revenue | $470.38M | +110.9% | $2.46B | $3.69B |
| EPS (Non-GAAP) | $1.1651 | +124.1% | $6.1512 | $9.1203 |
Consensus sits near the midpoint of company guidance, leaving little cushion for a headline miss. The FY27 EPS number has been revised up from $5.5158 ninety days ago, with four upward revisions in the last 30 days and zero cuts. The Street is bracing for triple-digit growth without meaningful margin give-back.
Tonight, I’ll be watching the optical trajectory first. Management framed fiscal 2027 as mid-single-digit sequential growth in the first half with an inflection beginning in the second half, powered by ZeroFlap Optics, silicon photonics PICs, and existing DSPs. Each is targeted to clear more than $100 million in revenue this fiscal year.
Analysts will also focus on gross margin mix. The Q1 guide of 67.0% to 69.0% is right in the middle of the 68.3% Q4 result, so any dip toward the low end will get read as new-product dilution.
Customer concentration is the third watchpoint. In Q4, the top four customers represented 34%, 27%, 16%, and 10% of revenue. I’ll be listening for how CEO Bill Brennan quantifies the neocloud ramp, which he sized at around 20% collectively over time.
Fourth, watch operating expense cadence. Non-GAAP OpEx guidance of $86.0-$90.0 million ties to a full-year OpEx increase of approximately 50% year-over-year, and Brennan targets non-GAAP net margin in the vicinity of 50%.
| Quarter | EPS Surprise | Revenue Surprise | YoY Revenue |
|---|---|---|---|
| Q4 FY26 | +12.17% | +0.86% | +157.02% |
| Q3 FY26 | +13.75% | +5.00% | +201.49% |
| Q2 FY26 | +35.27% | +14.06% | +272.08% |
| Q1 FY26 | +44.20% | +17.02% | +273.57% |
Credo has beaten EPS in four straight quarters.
Contact [email protected] for any questions or corrections.
Thomas Richmond is a financial writer and content strategist with 5+ years of experience covering stocks and financial markets. He has published over 250 articles focused on individual stock analysis, helping investors better understand business fundamentals, stock valuations, and long-term opportunities.
Thomas previously served as a Content Lead at TIKR, a stock research platform, where he helped scale the company’s blog to hundreds of articles per month and contributed to a weekly newsletter reaching more than 100,000 investors.
He specializes in breaking down complex companies into clear, actionable insights for everyday investors, with a focus on fundamentals-driven research.
His work has also been featured on platforms including Seeking Alpha and Sure Dividend.
Outside of work, Thomas enjoys weight lifting and soccer.
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