Shares of Credo Technology Group Holding Ltd (CRDO) surged 12.85% in pre-market trading on Tuesday, following the release of its impressive fourth-quarter fiscal year 2025 financial results. The company's performance significantly exceeded analyst expectations, driven by robust growth in demand for its high-performance connectivity solutions, particularly among hyperscaler customers for advanced AI services.

For the quarter ended May 3, 2025, Credo reported revenue of $170 million, marking a substantial 179.7% increase year-over-year and surpassing the analyst consensus estimate of $160.2 million. The company's adjusted earnings per share reached $0.35, a dramatic improvement from $0.07 in the same period last year and comfortably beating the expected $0.28 per share. Credo's adjusted gross margin for the quarter stood at an impressive 67.4%, reflecting the company's operational efficiency and strong market position.

Looking ahead, Credo provided a strong outlook for the first quarter of fiscal year 2026, projecting revenue between $185 million and $195 million, well above analyst expectations of $162.4 million. The company's CEO, Bill Brennan, attributed the stellar performance to surging demand for Credo's innovative, reliable, and energy-efficient high-performance connectivity solutions, particularly in powering advanced AI services for hyperscaler customers. Brennan expressed confidence that this trend would persist for the foreseeable future, underlining Credo's strong position in the rapidly growing AI infrastructure market.