Credo Posts Record Quarterly Revenue; Optical Product Lines Target $600M in FY2027
Taylor Wilson
Credo Technology says its optical DSP, silicon-photonics chips, and ZF Optics lines will each top $100 million in fiscal 2027, combining to exceed $600 million. This means → optical interconnect is shifting from a side business to a core AI-infrastructure revenue engine.
Where does the $600 million in optical revenue come from?
Credo splits its optical business into three lines: optical DSP, silicon-photonics chips (SiPho PICs) — chips that move data with light instead of electricity — and zero-flattening optics (ZF Optics).
Each line is expected to contribute over $100 million in fiscal 2027, totaling more than $600 million, with growth accelerating in the second half.
This means → optics is no longer Credo's sidecar — it is becoming the main engine.
How do the three lines differ on pricing?
CEO Bill Brennan disclosed that optical DSP and SiPho PICs carry ASPs typically in the low double-digit dollars; ZF Optics reaches triple-digit dollars.
In plain terms = per unit, a ZF Optics part sells for several times the price of the other two lines.
Brennan therefore expects ZF Optics to be the single largest revenue contributor within the optical portfolio.
What did the DustPhotonics acquisition bring?
One week before the earnings call, Credo closed its acquisition of DustPhotonics, gaining silicon-photonics PIC technology; net cash outlay in Q1 was roughly $750 million.
Brennan said the technology can dramatically simplify optical design and sharply cut the number of lasers needed — potentially easing industry-wide supply-chain constraints.
This means → Credo paid a premium not just for a technology, but for a ticket to simplify the supply chain.
Why do larger AI clusters need Credo more?
Brennan's core argument: as AI clusters scale from tens of thousands to hundreds of thousands of GPUs, the bottleneck shifts from compute to network reliability and efficiency.
In plain terms = there are enough GPUs — but if the links connecting them wobble, the entire cluster stalls and GPU utilization drops.
In Q4, four customers exceeded 10% of revenue, at 34%, 27%, 16%, and 10% respectively; the NeoCloud customer segment is on track to reach roughly 20% of revenue.
How strong was the fiscal 2026 scorecard?
Full-year revenue topped $1.3 billion, up roughly 206% year-over-year; non-GAAP net income rose more than fivefold to $662 million.
Q4 revenue hit a record $437 million — one quarter alone exceeded all of fiscal 2025's total revenue.
Management guided fiscal 2027 total revenue growth above 80%.
What drives growth further out?
Management pointed to the Weaver gearbox chip — a specialized interconnect chip that sits between GPUs — as the fiscal 2028 growth catalyst.
Brennan estimated each GPU could generate $2,000 to $3,000 in revenue contribution from Weaver.
He acknowledged supply-chain tightness "could persist into next year or longer," but stressed: "Without these small interconnect chips, clusters simply cannot be built."
Content is for reference only, not financial advice.