Meet Credo: The Quiet Company Powering the AI Boom
While companies like Nvidia and AMD grab headlines as the stars of the AI revolution, there’s a lesser-known player quietly riding the wave—and it’s making serious noise on Wall Street.
Credo, a Silicon Valley semiconductor company founded 17 years ago, has become a key supplier to the fast-growing AI data center market. Their specialty? High-performance cables that cost hundreds of dollars each and connect the powerful computers that run artificial intelligence systems.
Why $300-$500 Cables Are the New Gold in AI
It might sound strange that cables can be worth so much. But in the AI world, these are not your average cords. Credo’s signature “purple cables” help AI servers communicate faster and more reliably. This is crucial because AI workloads demand huge amounts of data moving back and forth with almost zero delay.
Bill Brennan, Credo’s CEO, puts it simply: “You’ve got this insatiable demand from the AI cluster world.” In other words, AI companies need more and more cables to build the massive data centers that train and run AI models.
The Stock Market is Taking Notice
Credo’s share price has been on an impressive run, more than doubling this year to reach about $143.61. That’s after an incredible 245% surge in 2024 alone. To put that in perspective, the company’s market value has skyrocketed from $1.4 billion at its 2022 IPO to nearly $25 billion today.
This dramatic growth shows how investors are betting on Credo’s role in the booming AI infrastructure market.
What’s Driving This Rapid Growth?
Several factors are fueling Credo’s rise:
- Massive AI Infrastructure Expansion: Tech giants and cloud companies are building huge new data centers to support AI. These data centers need a huge number of cables to connect servers and keep data flowing.
- Active Electrical Cable Market on the Rise: Credo pioneered the active electrical cable (AEC) technology, which improves speed and efficiency in data transmission. Analysts at JPMorgan Chase recently gave Credo a buy rating and set a price target of $165 per share, predicting the AEC market could hit $4 billion by 2028.
- A Key Role in the AI Supply Chain: While other companies focus on AI chips, Credo’s cables are an essential but often overlooked piece of the puzzle—helping AI systems perform at lightning speed.
What Makes Credo Different From Other Tech Companies?
Unlike flashy AI chipmakers, Credo operates behind the scenes, focusing on the hardware that connects everything. Their cables are designed to work with some of the world’s most advanced computing systems. The price tag on these cables reflects their critical role in making AI fast and reliable.
According to analysts, the increasing complexity and scale of AI data centers mean companies like Credo will be in higher demand for years to come.
What’s Next for Credo?
With the AI boom showing no signs of slowing, Credo is positioning itself for even bigger growth. The company’s focus on innovation and expanding its cable technology lineup could help it capture an even larger share of the growing AI infrastructure market.
Investors are watching closely, and with strong analyst support and rising demand, Credo looks set to stay in the spotlight.
Final Thoughts: The Hidden Hero of the AI Revolution
While AI breakthroughs often make headlines for their software and smart algorithms, the physical infrastructure powering those breakthroughs is just as important. Credo’s high-performance cables are a perfect example of how sometimes, the smallest components can make the biggest difference.
If you’re looking for the next big opportunity in AI beyond the obvious chipmakers, Credo might just be the secret star worth knowing.
I am Aparna Sahu
Investment Specialist and Financial Writer
With 2 years of experience in the financial sector, Aparna brings a wealth of knowledge and insight to Investor Welcome. As an accomplished author and investment specialist, Aparna has a passion for demystifying complex financial concepts and empowering investors with actionable strategies. She has been featured in relevant publications, if any, and is dedicated to providing clear, evidence-based analysis that helps clients make informed investment decisions. Aparna holds a relevant degree or certification and is committed to staying ahead of market trends to deliver the most up-to-date advice.