Credo Technology Raises Q3 Revenue Guidance Amid Market Decline
Written by Emily J. Thompson, Senior Investment Analyst
Updated: Jan 06 2026
0mins
Should l Buy CRDO?
Source: Benzinga
Credo Technology Group Holding Ltd's stock fell by 5.01% as it crossed below the 5-day SMA, reflecting broader market weakness with the Nasdaq-100 down 1.61% and the S&P 500 down 1.02%.
Despite the decline in stock price, Credo Technology raised its Q3 2026 revenue guidance to between $404 million and $408 million, significantly higher than the previous range of $335 million to $345 million. This increase indicates strong demand and growth potential in the semiconductor market, with analysts predicting year-over-year growth exceeding 200% for FY26, further solidifying the company's market position.
The optimistic revenue guidance reflects Credo's ability to capitalize on the growing demand for its high-performance networking tools, particularly in the data center sector. This positive outlook may attract investor interest despite the current market conditions.
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Analyst Views on CRDO
Wall Street analysts forecast CRDO stock price to rise
13 Analyst Rating
12 Buy
1 Hold
0 Sell
Strong Buy
Current: 124.800
Low
170.00
Averages
221.82
High
260.00
Current: 124.800
Low
170.00
Averages
221.82
High
260.00
About CRDO
Credo Technology Group Holding Ltd is a Cayman Islands-based holding company. The Company delivers high-speed solutions to break bandwidth barriers on every wired connection in the data infrastructure market. It provides high-speed connectivity solutions that deliver improved power efficiency as data rates and corresponding bandwidth requirements increase exponentially throughout the data infrastructure market. Its connectivity solutions are optimized for optical and electrical Ethernet applications, including the emerging 100 gigabits per second (G), 200G, 400G, 800G and the emerging 1.6 terabits per second (T) port markets. Its products are based on its Serializer/Deserializer (SerDes) and Digital Signal Processor (DSP) technologies. Its product families include integrated circuits (ICs) for the optical and line card markets, active electrical cables (AECs) and SerDes Chiplets. The Company’s intellectual property (IP) solutions consist primarily of SerDes IP licensing.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
Goldman Sachs Optimistic on Credo Technology's Future
- Growing Market Demand: Analyst James Schneider from Goldman Sachs highlights a surge in demand for high-speed, short-range connectivity in AI data centers, which is expected to further drive growth for Credo Technology Group, showcasing the company's strong market potential.
- Buy Rating and Price Target: Goldman Sachs initiates coverage on Credo with a buy rating and sets a 12-month price target of $165, indicating a 29% upside from Wednesday's close, reflecting the analyst's confidence in the company's future performance.
- Significant Technological Advantage: Credo's Active Electrical Cables (AECs) technology offers low-cost, high-bandwidth, and highly reliable connectivity solutions, and Schneider believes this technology will remain mainstream for at least the next five years, further solidifying the company's market position.
- Diversification Strategy: Schneider commends Credo's diversification efforts into optical solutions, which he believes will support long-term growth, while also appreciating the company's carefully managed guidance and investor messaging.
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Goldman Sachs Optimistic on Credo Technology's Future
- Growing Market Demand: Analyst James Schneider from Goldman Sachs highlights a surge in demand for high-speed, short-range connectivity in AI data centers, which is expected to further drive growth for Credo Technology Group, showcasing the company's strong market potential.
- Buy Rating and Price Target: Goldman Sachs initiates coverage on Credo with a buy rating and sets a 12-month price target of $165, indicating a 29% upside from Wednesday's close, reflecting the analyst's confidence in the company's future performance.
- Significant Technological Advantage: Credo's Active Electrical Cables (AECs) technology offers low-cost, high-bandwidth, and highly reliable connectivity solutions, and Schneider believes this technology will remain mainstream for at least the next five years, further solidifying the company's market position.
- Diversification Strategy: Schneider commends Credo's diversification efforts into optical solutions, which he believes will support long-term growth, while also appreciating the company's carefully managed guidance and investor messaging.
See More
Duan Yongping's Strategic Moves in Q4 2025
- New Portfolio Adjustments: In Q4 2025, Duan Yongping added three new stocks, with CoreWeave Inc being the largest at 299,900 shares valued at $21.48 million, representing 0.12% of his portfolio, indicating a focus on emerging tech companies.
- Significant Increase in NVIDIA: Yongping increased his stake in NVIDIA by 6,639,300 shares, bringing his total to 7,237,100 shares, a remarkable 1,110.62% increase, which not only raised its weight in the portfolio by 7.08% but also reflects confidence in the semiconductor industry's strong outlook.
- Reduction in Apple Holdings: He reduced his Apple shares by 2,470,600, resulting in a 7.09% decrease in holdings and a -4.29% impact on the portfolio, indicating dissatisfaction with the stock's recent performance, which averaged $268.66 during the quarter.
- Portfolio Overview: As of Q4 2025, Yongping's portfolio included 14 stocks, with Apple making up 50.3% and Berkshire Hathaway 20.63%, showcasing a highly concentrated investment strategy in technology and financial services sectors.
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- Strong Small-Cap Performance: The Russell 2000 index has achieved an 8% return in 2026, significantly outperforming the S&P 500's 1.4%, indicating robust small-cap performance in the current economic climate and attracting investor interest.
- Diversified Portfolio: The Vanguard Russell 2000 ETF's top ten holdings account for only 5% of its weight, ensuring that its performance is not heavily influenced by a small group of stocks, thus achieving stable returns through broad portfolio contributions.
- Favorable Rate Policies: The Federal Reserve has cut interest rates six times since September 2024, with two more cuts expected in 2026, directly boosting profitability for about 32% of Russell 2000 companies, enhancing their long-term growth potential.
- Attractive Valuation: With a price-to-earnings ratio of 20.4, the Russell 2000 trades at a 19% discount to the S&P 500's 25.2, providing an attractive opportunity for investors and potentially driving continued strong performance in 2026.
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- ETF Performance: The Vanguard Russell 2000 ETF (VTWO), which tracks the index, is also expected to benefit from this strong performance, with momentum likely to persist throughout 2026, further boosting investor confidence.
- Sector Distribution: Companies in the Russell 2000 span 11 different sectors, with healthcare comprising 18.8%, showcasing the diversity of its portfolio, especially compared to the S&P 500 where tech dominates at 32.9%.
- Monetary Policy Impact: The Federal Reserve has cut interest rates six times since September 2024, with two more cuts predicted in 2026, directly enhancing profitability for about 32% of Russell 2000 companies and driving future growth.
See More
Surge in AI Stock Investments Amid $650 Billion Spending Plans
- Market Investment Trend: Microsoft, Alphabet, Amazon, and Meta are set to invest up to $650 billion in AI in 2023, and while their stocks have dipped slightly, investors should focus on AI infrastructure companies that are expected to benefit significantly from this trend.
- Nvidia Earnings Expectations: Nvidia (NVDA) is anticipated to report quarterly earnings on February 25, with expectations of a substantial revenue increase following last year's record revenue of $57 billion, of which $51.2 billion came from its data center segment, indicating strong market demand.
- TSMC's Market Position: Taiwan Semiconductor Manufacturing (TSM) is the preferred foundry for top chipmakers, producing over 11,800 products in 2024, with 63% of its shipments in Q4 2025 being 3nm or 5nm chips, showcasing its leadership in efficient chip manufacturing.
- Nebius Group Expansion Plans: Nebius Group (NBIS) aims to increase its data center connected power from 220 megawatts to between 800 megawatts and 1 gigawatt by the end of 2026, backed by contracts worth up to $19.4 billion with Microsoft and $3 billion with Meta, highlighting its rapid growth potential in AI cloud platform development.
See More
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- AI Investment Surge: Microsoft, Alphabet, Amazon, and Meta are set to invest up to $650 billion in AI this year, creating significant demand for related infrastructure companies, particularly chipmakers like Nvidia and TSMC, which are expected to benefit from this trend.
- Nvidia Earnings Outlook: Nvidia is projected to report record revenue of $57 billion for Q3 of fiscal 2026, with $51.2 billion coming from its data center segment, indicating strong demand for its Blackwell GPUs and suggesting robust growth potential for the company.
- TSMC's Market Position: As a leading chip manufacturer, TSMC produced over 11,800 products in 2024, with 63% of its shipments in Q4 2025 being 3nm or 5nm chips, highlighting its leadership in efficient chip manufacturing.
- Nebius Expansion Plans: Nebius Group aims to increase its data center connected power from 220 megawatts to between 800 megawatts and 1 gigawatt by the end of 2026, backed by contracts worth up to $19.4 billion with Microsoft and $3 billion with Meta, indicating rapid expansion and strong demand in the AI cloud platform market.
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