Initiating OP: AEC Standard + Emerging Optical AI Connectivity Play

研报英文原文证据摘录

Initiating OP: AEC Standard + Emerging Optical AI Connectivity Play

June 22, 2026

Executive Summary – Durable Growth In Both Copper & Optical

CRDO’s success as the creator of, and subsequent dominant player in the AEC market stems

from its approach to deliver a vertically integrated solution. Its IP stack runs from SerDes and

PAM-4 DSP up through firmware/telemetry software and finished system-level products. FY26

revenues of $1.34bn, increased by 3x YY and by more than 20x over 5 years since the company

came public. CRDO generates 68% Gross Margins and north of 50% Net Margins – offering a

rare combination of high growth and high profitability. We view the franchise as differentiated,

with its reliability-anchored and vertically-integrated systems approach as real and validated by

our checks with AI & Cable Assembly engineers in the industry. We believe the overall investor

debate surrounding the durability of AECs is mis-framed as it centers on NPO and CPO

proliferation leading to disintermediation. However, the main AEC use-case is in-rack scale-out,

whereas the main disintermediation risk from NPO and CPO is centered in the scale-up domain

(see checks). In the meantime, we expect CRDO to extend its scale-out leadership in copper-

based AEC’s into the optical domain with its ZFOptics portfolio.

We believe investors win 5 ways w/ CRDO:

1. Exposure to Highest Growing Sub-Segment in Data Center Silicon. Exposure to the

highest growing segment of an AI Data Center Semis TAM that is forecasted to expand to

$1.3 Trillion by 2030 vs $250bn in 2025 – with Networking forecasted to grow at mid-60s%

CAGR vs Memory/Logic/Other growth forecasts in Low-30s% to Low-40s% CAGR

2. Exposure to Share Gainer Within Networking. CRDO’s share in AI networking has