Credo Technology Group Holding Ltd【CRDO】株式ニュース

On AEC cables; These analysts will (BoA, GS) soon know there is also something like ACC cables. Credo expecting a product mix of 50% AEC revenues in the near future. That pretty big news for Spectra7 also, imo.

Vijay Rakesh
Yes. Hi, Bill and Dan. Great quarter and guide.

Just a quick question on the mix of revenues on the product side, when you look at the 4Q and 1Q, if you can use the split of AEC versus optical and Line Card?

Dan Fleming
Yes, thanks Vijay.

So, we don't -- unfortunately, we don't disclose specifics when it comes to our product line mix, but from our from a long-term perspective, the expectations that we've set out where we're trending toward those amounts, which longer term, we would expect AEC to be nearly half of our revenue. Again, IP, right now, we're not quite at the long-term model, of course, so we're slightly above the 10% to 15%. And then the Line Card business has been a very, very strong business for us, and it continues its strength and is growing. Longer term, it'll probably be in the 15% range. And then the balance, optical will be a significant contributor this year, especially towards the end of the year and then even more so next year.

So, hopefully, that gives you just kind of broad strokes, the direction that we're headed.

Vijay Rakesh
Got it. And on the AEC side, I know you guys have a pretty broad portfolio of MACsec and phase shift, and speed-shift and Nick-to-ToR, et cetera. I'm just wondering when you look at the company landscape and given your broad breadth of portfolio and you're qualified many of the enterprise hyperscale guys, what is the competitive moat? I mean, you guys think you have a 12 to 24-month or even longer lead-time when you compare -- when you look at the competition, who I would say, most of them are still trying to get their product in place, but if you can give some color on how you look at that space?

Bill Brennan
Yes, great question.

I think that -- first of all, I'll say that we're very happy that we see competitors validating the AEC product category. We feel like we do have a significant bleat [ph] in a sense that we've been working on this product category for -- going on four years. The approach that we've taken, I think, is unique in a sense that we have built an organization internally at Credo that's responsible for the design, the development, and ultimately, the delivery of the AEC System Solution. That means that at the end of the day, we're responsible for the entire AEC System Solution with a single throat to choke in a sense when we're dealing with customers.

Our manufacturing partners do a great job in what they do well. We had started by thinking that we could sell chips to copper cable companies, and it just simply was very clear very quickly that our approach is going to be more effective if we owned the entire system design from the firmware -- to the holes from the firmware, on the copper, to the test program development to the actual tester design and development. We felt that that was a much stronger approach than trying to rely on others to put all this together.

So, I do think that as we look at our business now, it's really taken shape in a sense that it's different than our original thinking, which was, hey, we'll just put together a 400-gig on each end of the cable -- 400-gig connector on each of the cable. The solutions we're delivering in volume right now are unique. These are truly system level solutions that are -- I think would be -- could be classified as the most advanced connectivity solution -- cable connectivity solutions ever delivered to the data center.

If you think about what we're shipping currently to our first hyperscalar, they were successful in deploying a dual tour architecture in a single rack, because of the intelligence in our cable, we've got the ability to sense when the ToR port is failing, our cable makes the decision to switch the data flow to the second port.

So, this is a level of intelligence in the cable that has never been delivered as a DAC never been delivered as an AEC or other optical connection.

And so this is the direction that our business has taken as a result of us owning and really building the capability internally. I can tell you that the second solution that we're developing is also very unique. It's not just a straight cable.

And so we expect that more and more innovation will be requested by our customer base, as they see this is now a category where they can think about systems solutions that they haven't even thought of before. There will be business, especially, in the switching and routing layer that is leading edge 800-gig ports, where you have 800-gig connectors on each end of the cable. That's going to be a robust business as well. But generally, we think that the approach we took is paying off right now, as you see us taking off as a clear leader in the space. But I will say that having competition is always a great thing.

So, we appreciate that multiple people are now investing and that it seems that the market is accepting AEC as really a de facto solution for short connections, meaning three meters and less.

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