Major Acquisition of $700 Million to Boost AI Data Center Optical Communication

Credo Technology Group Holding Ltd (CRDO) on April 13 announced that it has entered into a definitive agreement to acquire DustPhotonics—a specialist in silicon photonics PIC (photonic integrated circuit) technology—for $750 million in cash and Credo stock, plus contingent equity awards tied to future performance.

With this transaction, Credo will vertically integrate zero-flap optical transceivers, optical DSPs and silicon photonics components to bolster its next-generation optical portfolio—supporting 400 Gb, 800 Gb and 1.6 Tb solutions—and is targeting more than $500 million in optical business revenue in fiscal 2027.

Credo’s Chief Technology Officer, Cheng Chi-Feng, also disclosed that he sold shares on multiple occasions in March and early April under a pre-arranged Rule 10b5-1 trading plan—amounting to a small portion of his total holdings.

Following the acquisition announcement, Credo’s stock jumped over 10 percent on the Nasdaq on April 13 and 14. On April 14, the company hosted a conference call to discuss the strategic rationale and potential synergies of the deal.

Analysts believe this acquisition will accelerate Credo’s push into high-speed optical interconnects for AI data centers. Recent research reports continue to maintain a “Buy” consensus rating on the shares.

Credo is a fabless semiconductor company that designs high-speed, low-power connectivity solutions for AI, cloud and hyperscale data centers. Its core products include high-speed SerDes, active electrical cables and optical DSPs. Silicon photonics-based optical transceivers are seen as critical infrastructure for ultra-fast data transfer between AI servers—and are expected to drive a multibillion-dollar next-generation data center communications component market by 2030.