Credo Technology shares fall on competition concerns

Credo Technology Group shares dropped 8.7% in morning trading on Friday, reaching $148.60 and touching a session low of $142.89. The stock had closed at $162.77 in the previous session.

The decline followed comments from MaxLinear's CEO Kishore Seendripu during his company's analyst call. Seendripu said Credo controls between 93% and 99% of the AEC cable market, but noted the industry is starting to diversify as the technology becomes more complex. MaxLinear plans to target a meaningful share of the 1.6T AEC market over the next few years.

Edgewater Research released findings showing limited evidence of meaningful near-term 1.6T AEC deployments among the largest AI programs. The research firm suggested this could delay the revenue opportunity that investors had expected from the transition to faster connectivity.

Edgewater also noted a large proprietary 1.6T program at Cisco Systems Inc, which is seeking quotes for 100,000 cables per month. The program may be bundled with Cisco's switching silicon and could source digital signal processors from Broadcom Inc or MaxLinear Inc rather than Credo.

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