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![CorleoneDon77 Avatar](https://lunarcrush.com/gi/w:24/cr:twitter::1577382889104318472.png) DonCorleone77 [@CorleoneDon77](/creator/twitter/CorleoneDon77) on x 5296 followers
Created: 2025-07-09 11:04:37 UTC

$CRDO

Note: I am currently long CRDO.

Attached is page X of a 5-page Bank of America analyst report on CRDO issued yesterday entitled:

"Mgmt call takeaways: AI connectivity specialist, 5x growth oppty."

Bank of America has an 'Buy' rating on CRDO with a $XXX price target.

Bank of America's summary statement regarding CRDO in the report includes the following:

"Increasing opportunities in both AECs/optics, PO $120:

On Tuesday, we hosted CRDO CEO Bill Brennan, CFO Daniel Fleming, VP AEC/Product Don Barnetson, and VP IR Dan O’Neil for a well-attended investor call. 

Key highlights include: 

1) mgmt sees AEC TAM eventually reach $5bn-10bn+, servicing the rapidly growing 100G+/lane scale-out connectivity and expanding into new scale-up opps.; 
2) XXX AEC links per XPU today servicing just 2mn XPUs today (of ~10mn globally), suggesting a large room for increased adoption over time; 
3) customer diversification on track, with 3-4 10%-customers at any given quarter in FY26; 
4) CRDO’s system-based approach in AEC gives cost/supply chain advantage over silicon-only peers; and 
5) increased opps in system-based optical solutions, with new products (LROs, DSPs, etc.) expected to launch throughout FY26/27. 

Importantly, we now see a higher EPS power of ~$3 by CY27 and $7+ over time on increased AEC TAM outlook, well above Street’s $XXXX for CY27. Reiterate Buy for our top SMidcap, raise PO to $XXX from $100, now on 70x CY26E PE vs. 59x prior, but still in-line with 1.0x-2.0x PEG framework for high-growth AI vendors.

XXX AEC links per GPU today, AEC TAM eventually $5-10bn:

CRDO believes AEC TAM could eventually reach $5bn-$10bn+. Notably, this is significantly larger than the $1bn+ outlook portrayed by our call with XXX Group (takeaway here), but not out of the equation as compute/switch rack density continues to increase and mgmt believes AEC to become the de facto standard for 100G+/lane connectivity. 

From a bottom-up perspective, AEC customers today deploy ~1.5 AEC links per XPU, which at $XXX ASP and ~$600mn CY25 AEC TAM only services 2mn XPUs (vs. ~10mn global shipment). By CY30, at a XXX% AEC adoption servicing our $650bn or 30mn unit AI XPU TAM, AEC opportunities could expand to 45mn units or $9bn+.

-- Price objective basis:

Our $XXX PO is based on 70x CY26E P/E, within the range of similar high-growth compute/optical semiconductor peers trading 21x-78x. 

-- Downside risks to our PO are: 

(1) increased competition from large cap peers Marvell/ Broadcom, 
(2) delayed adoption of active electrical cable (AEC) products, 
(3) downturn in spending across hyperscalers and network operators, 
(4) Inability for CRDO to scale and meet demand from products beginning to ramp, 
(5) supply chain headwinds limiting available capacity. 

-- Upside risks are: 

(1) unforeseen, accelerated AEC engagements, 
(2) sudden rebound in ramp for higher margin optical DSP products, 
(3) prudent opex/margin management to support EPS in downcycle."

(Page X is not available here as X does not allow me to post pages from reports on this platform)


XXX engagements

![Engagements Line Chart](https://lunarcrush.com/gi/w:600/p:tweet::1942902706743501045/c:line.svg)

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