Credo Technology Guides Fiscal 2027 Revenue Growth Above 85%

Qualcomm shares rose 7% to $190.82 in Monday afternoon trading after Lumentum Holdings announced a joint demonstration with Qualcomm Technologies and Corning of a high-density die-to-die optical interconnect built for artificial intelligence scale-up architectures. The demo, to be shown at an optical communications industry conference in Málaga, Spain, pairs a die-to-die interface subsystem from Qualcomm Technologies with Lumentum's laser-based optical interconnect platform and Corning multimode fiber connectivity. Qualcomm's advance far outpaced the broader chip tape, with the iShares Semiconductor ETF up 4% to $555.42 and the Invesco QQQ Trust up 2.51% to $738.79. Skyworks Solutions and Qorvo, the two radio frequency front-end suppliers typically grouped with Qualcomm in the handset supply chain, each gained just 0.4%, to $89.11 and $117.60 respectively, confirming the rally is specific to Qualcomm's AI story rather than a handset-cycle move. The demonstration carries no product or customer order, leaving investors to weigh whether Qualcomm has found a genuine AI second act.

Credo Technology Group Holding Ltd launched a new family of 224G-based ZeroFlap optical transceivers, extending its optical architecture to 1.6T port speeds. The new transceivers combine Credo's 224G-per-lane optical digital signal processor with the Kfir200 silicon photonics PIC and its latest-generation PILOT diagnostics platform, and the family includes 2xDR4, 2xFR4 and DR8 configurations supporting AI scale-out interconnect architectures at 1.6T port speeds. The launch matters because management expects more than $600 million in optical revenues in fiscal 2027, with ZeroFlap optics, silicon photonics PICs and optical DSPs each expected to contribute more than $100 million. Credo's May acquisition of DustPhotonics brought silicon photonics capabilities in-house, and the company recorded its first silicon photonics revenues in the fiscal first quarter while its optical digital signal processor business generated record revenues during the period. Management expects additional fiscal 2027 customer ramps across both 800G and 1.6T products involving hyperscalers and NeoCloud operators, as well as its first 1.6T optical DSP revenues later in fiscal 2027, though GAAP research and development expense rose 118% year over year to $114.5 million in the fiscal first quarter and results remain sensitive to deployment timing.

Wall Street analysts issued a fresh round of ratings changes, led by an upgrade of Ciena and a downgrade of Flutter Entertainment. Evercore ISI upgraded Ciena to Outperform from In Line with a price target of $550, up from $375, calling the optical networking space a critical bottleneck in the AI buildout. Rothschild & Co Redburn downgraded Flutter Entertainment to Neutral from Buy with a price target of $119, down from $169, citing four consecutive guidance cuts. BNP Paribas upgraded AT&T to Outperform from Neutral with a price target of $30, up from $26, while HSBC double downgraded CCU to Reduce from Buy with a price target of $10, down from $15. In initiations, Rothschild & Co Redburn started CoreWeave at Sell with a $54 price target and Equinix at Buy with a $1,261 price target, and Needham initiated Nano Nuclear Energy at Buy with a $33 price target.