FULLTEXT DEL 3 AV 3
10-K – 2026-06-15 – crdo-20260502.htm
Year Ended May 2, 2026 May 3, 2025 April 27, 2024 United States $ 36,047 $ 13,795 $ 8,611 International 439,388 41,075 ( 31,356 ) $ 475,435 $ 54,870 $ ( 22,745 ) The components of income tax expense (benefit) are summarized as follows (in thousands): Year Ended May 2, 2026 May 3, 2025 April 27, 2024 Current Federal $ — $ — $ 2 State 32 12 3 International 6,224 2,253 1,484 Total current tax expense 6,256 2,265 1,489 Deferred Federal ( 2,562 ) — 3,092 State ( 152 ) — 359 International ( 386 ) 422 684 Total deferred tax expense (benefit) ( 3,100 ) 422 4,135 Total tax expense $ 3,156 $ 2,687 $ 5,624 The Company adopted ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures , on a prospective basis, in the fiscal year 2026. The Company consists of a Cayman Islands parent holding company with various international and U.S. subsidiaries. The applicable statutory rate in Cayman Islands is zero for the Company for the years ended May 2, 2026, May 3, 2025 and April 27, 98 Credo Technology Group Holding Ltd Notes to Consolidated Financial Statements 2024. A reconciliation of the U.S. 21% rate to the effective tax rate pursuant to the disclosure requirements of ASU 2023-09 for the year ended May 2, 2026, was as follows (in thousands): Year Ended May 2, 2026 Statutory federal tax expense $ 99,841 21 % State tax, net of federal benefit ( 2,980 ) ( 1 ) % Nontaxable or nondeductible items: Share-based compensation ( 73,448 ) ( 15 ) % Section 162(m) limitation 9,378 2 % Other 1,011 — % Research tax credit ( 32,047 ) ( 7 ) % Change in valuation allowance 78,617 17 % Foreign rate differential: Cayman Islands ( 86,088 ) ( 18 ) % Withholding taxes 148 — % Other foreign jurisdictions ( 635 ) — % Change in unrecognized tax benefits 9,362 2 % Other ( 3 ) — % Effective tax rate $ 3,156 1 % Pursuant to the disclosure requirements of ASU 2023-09, the following table presents income taxes paid, net of refunds received, for the year ended May 2, 2026 (in thousands): Year Ended May 2, 2026 Federal $ — State 11 Foreign: Hong Kong 1,992 Taiwan 243 China 125 Cayman Islands 101 Total income taxes paid $ 2,472 The Company consists of a Cayman Islands parent holding company with various international and U.S. subsidiaries. Under the current laws of the Cayman Islands, the Company is not subject to tax on its income. For purposes of the reconciliation, prior to adoption of ASU 2023-09, Income Taxes (Topic 740): improvements to Income Tax Disclosures , between the provision (benefit) for income taxes at the 99 Credo Technology Group Holding Ltd Notes to Consolidated Financial Statements statutory rate and the effective tax rate, a notional U.S. 21% rate is applied to pretax income (loss) as a result of the following for the periods indicated, respectively: Year Ended May 2, 2026 May 3, 2025 April 27, 2024 Statutory federal tax expense rate 21 % 21 % 21 % State tax, net of federal benefit — % — % ( 2 ) % Research tax credits ( 5 ) % ( 24 ) % 20 % Share-based compensation ( 14 ) % ( 53 ) % 24 % Other 1 % — % ( 1 ) % Foreign rate differential ( 19 ) % ( 12 ) % ( 34 ) % Change in valuation allowance 17 % 72 % ( 49 ) % Withholding taxes — % 1 % ( 4 ) % Effective tax rate 1 % 5 % ( 25 ) % The tax effects of significant items comprising the Company’s deferred taxes are as follows (in thousands): May 2, 2026 May 3, 2025 Deferred tax assets Accrued expense $ 2,851 $ 1,904 Net operating losses 78,363 28,557 Research and development credits 72,874 35,641 Share-based compensation 10,560 3,667 Lease liability 4,968 3,063 Intangibles — 141 Others 870 11 Total deferred tax assets 170,486 72,984 Deferred tax liabilities Property and equipment basis ( 1,954 ) ( 1,963 ) Right of use assets ( 4,780 ) ( 2,890 ) Intangibles ( 6,499 ) — Total deferred tax liabilities ( 13,233 ) ( 4,853 ) Valuation allowance ( 162,892 ) ( 69,456 ) Net deferred taxes $ ( 5,639 ) $ ( 1,325 ) A valuation allowance is established when the Company believes that it is more likely than not that some portion of its deferred tax assets will not be realized. As of May 2, 2026, the Company recorded $ 162.9 million of valuation allowance. In fiscal year 2026, the valuation allowance increased by $ 93.4 million. The Company continues to maintain a full valuation allowance on its U.S. net deferred tax assets. The Company will continue to assess the future realization of its deferred tax assets in each applicable jurisdiction and adjust the valuation allowance accordingly. As of May 2, 2026, the Company had U.S. federal and state net operating loss carryforwards of approximately $ 353.0 million and $ 58.5 million, respectively. The U.S. federal net operating loss carryforwards can be carried forward indefinitely. The state net operating loss carryforwards will begin to expire in fiscal 2043. As of May 2, 2026, the Company had U.S. federal and state research credits of $ 61.3 million and $ 37.1 million, respectively. The federal research credits will begin to expire in 2039. The state research credits have no expiration date. As of May 2, 2026, the Company had no foreign tax credit carryover. Internal Revenue Code Section 382 limits the use of net operating loss and tax credit carryforwards in certain situations where changes occur in the 100 Credo Technology Group Holding Ltd Notes to Consolidated Financial Statements stock ownership of a company. In the event that we had a change of ownership, utilization of the net operating loss and tax credit carryforwards may be restricted. A summary activity of the valuation allowance is as follows (in thousands): May 2, 2026 May 3, 2025 April 27, 2024 Beginning valuation allowance $ 69,456 $ 23,258 $ 9,306 Additions 93,436 46,197 13,952 Ending valuation allowance $ 162,892 $ 69,456 $ 23,258 A reconciliation of the beginning and ending amounts of unrecognized tax benefits is as follows (in thousands): May 2, 2026 May 3, 2025 Beginning gross unrecognized tax benefits $ 9,440 $ 4,574 Additions for tax positions taken in the current year 10,910 5,196 Subtractions for tax positions taken in the prior year ( 747 ) ( 278 ) Lapses in statute of limitations ( 42 ) ( 52 ) Ending gross unrecognized tax benefits $ 19,561 $ 9,440 The Company recognizes the tax effects of an uncertain tax position only if it is more likely than not to be sustained based solely on such position’s technical merits as of the reporting date and only in an amount more likely than not to be sustained upon review by the tax authorities. The Company’s policy is to recognize interest and penalties accrued on any unrecognized tax benefits as a component of income tax expense. For the years ended May 2, 2026, and May 3, 2025, the Company’s current tax provision was not impacted by interest and penalties. The Company files U.S. federal and state and non-U.S. income tax returns with varying statutes of limitations. The Company’s tax returns continue to remain subject to examination by U.S. federal authorities for the years ended April 30, 2023 through 2025 and by state authorities for the years ended April 30, 2022 through 2025. For the Company’s international subsidiaries, the tax years that remain open to examination vary based on the year that each entity began operating. 101 Credo Technology Group Holding Ltd Notes to Consolidated Financial Statements 14. Net Income (Loss) Per Share Net income (loss) per share was determined as follows for the years presented (in thousands, except per share amounts): Year Ended May 2, 2026 May 3, 2025 April 27, 2024 Numerator: Net income (loss) $ 472,279 $ 52,183 $ ( 28,369 ) Denominator: Weighted-average shares outstanding used in basic calculation 178,538 167,505 155,091 Effect of dilutive shares Share-based compensation awards 9,694 10,611 — Customer Warrant — 3,042 — Weighted-average shares outstanding used in diluted calculation 188,232 181,158 155,091 Net income (loss) per share attributable to ordinary shareholders Basic $ 2.65 $ 0.31 $ ( 0.18 ) Diluted $ 2.51 $ 0.29 $ ( 0.18 ) Potential dilutive securities include dilutive ordinary shares from share-based awards attributable to the assumed exercise of share options, time-based and performance-based restricted share units and employee stock purchase plan shares using the treasury stock method. Under the treasury stock method, potential ordinary shares outstanding are not included in the computation of diluted net loss per share if their effect is anti-dilutive. The following potentially dilutive securities outstanding (in thousands) have been excluded from the computations of diluted weighted average shares outstanding for the years ended May 2, 2026, May 3, 2025 and April 27, 2024 : Year Ended May 2, 2026 May 3, 2025 April 27, 2024 Share-based compensation awards 609 3,349 16,777 Customer Warrant — — 4,080 609 3,349 20,857 15. Segment and Geographic Information As discussed in “Note 2. Significant Accounting Policies,” the Company operates in one reportable segment. The CODM uses net income or loss for the purposes of making operating decisions, allocating resources and evaluating financial performance. The measure of segment assets is reported on the consolidated balance sheet as total assets, although the CODM does not evaluate asset information for 102 Credo Technology Group Holding Ltd Notes to Consolidated Financial Statements purposes of allocating resources or evaluating performance. The table below provides information about the Company’s revenue, significant segment expenses and other segment expenses (in thousands): Year Ended May 2, 2026 May 3, 2025 April 27, 2024 Revenue $ 1,335,116 $ 436,775 $ 192,970 Less: Cost of revenue 426,767 153,866 73,538 Personnel related expenses 129,178 95,269 69,630 Share-based compensation 182,638 76,160 37,890 Other segment items* 124,254 59,297 40,281 Net income (loss) $ 472,279 $ 52,183 $ ( 28,369 ) *Other segment items primarily include lease expenses, external professional services expenses, depreciation and amortization, interest income and tax provision (benefit). The following table summarizes revenue disaggregated by primary geographical market based on destination of shipment for products, which may differ from the end customer’s principal offices (in thousands): Year Ended May 2, 2026 May 3, 2025 April 27, 2024 United States $ 768,051 $ 65,097 $ 49,569 Hong Kong 378,230 243,727 70,162 Mainland China 80,924 80,055 28,264 Taiwan 22,727 3,624 21,286 Rest of World 85,184 44,272 23,689 $ 1,335,116 $ 436,775 $ 192,970 The following table presents long-lived assets information based on the physical location of the assets by geographic region (in thousands): May 2, 2026 May 3, 2025 Property and equipment, net: Taiwan $ 68,064 $ 38,501 United States 14,709 12,793 Hong Kong 657 8,047 Rest of World 18,175 4,290 $ 101,605 $ 63,631 16. Subsequent Events Business Combination In May 2026, the Company acquired 100 % of the equity interest in DustPhotonics Ltd., a leading developer of silicon photonics photonic integrated circuit technology for optical connectivity, for a total purchase consideration of $ 770 million cash and approximately 0.8 million shares of the Company’s ordinary shares. In addition, the Company may pay incremental contingent consideration of up to 103 Credo Technology Group Holding Ltd Notes to Consolidated Financial Statements approximately 2.8 million shares and $ 31.6 million cash based on the achievement of certain financial milestones, subject to the terms of the definitive agreement. Share Incentive Plan On May 28, 2026, the Board of Directors of the Company approved a special performance-based equity award for the Company’s Chief Executive Officer in the form of performance-based restricted stock units (Special PSUs) under the 2021 Plan. The Special PSUs are 100 % performance-based and tied to six progressively challenging performance hurdles based on both revenue and stock price growth. Specifically, the Special PSUs are eligible to vest in six substantially equal tranches (set forth in the table below) subject to the achievement of (i) a revenue goal (Revenue Goal) and (ii) a stock price goal (Stock Price Goal) over a five-year performance period beginning on the grant date and ending on June 30, 2031. The Revenue Goal and Stock Price Goal hurdles for each tranche of the Special PSUs are as follows: Tranche Revenue Goal Hurdle Stock Price Goal Hurdle Earned PSUs (share amounts) 1 $ 2,500,000,000 $ 244.70 239,500 2 $ 3,500,000,000 $ 293.64 239,500 3 $ 4,500,000,000 $ 342.58 239,500 4 $ 5,500,000,000 $ 391.52 239,500 5 $ 6,500,000,000 $ 440.46 239,500 6 $ 7,500,000,000 $ 489.40 239,500 104 Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure None. Item 9A. Controls and Procedures Evaluation of Disclosure Controls and Procedures We maintain “disclosure controls and procedures,” as such term is defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act, that are designed to provide reasonable assurance that information required to be disclosed by us in reports we file or submit under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms and that such information is accumulated and communicated to our management, including our Chief Executive Officer (principal executive officer) and Chief Financial Officer (principal financial officer), as appropriate, to allow for timely decisions regarding required disclosure. Based on their evaluation as of the end of the period covered by this Annual Report on Form 10-K, our Chief Executive Officer and Chief Financial Officer have concluded that, as of such date, our disclosure controls and procedures were effective at the reasonable assurance level. Management’s Annual Report on Internal Control over Financial Reporting; Attestation Report of the Registered Public Accounting Firm. Our management is responsible for establishing and maintaining adequate “internal control over financial reporting,” as defined in Rule 13a-15(f) and Rule 15d-15(f) under the Exchange Act. Our management conducted an evaluation of the effectiveness of our internal control over financial reporting as of May 2, 2026 based on the criteria established in Internal Control - Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission. Based on the results of its evaluation, management concluded that our internal control over financial reporting was effective as of May 2, 2026. The effectiveness of our internal control over financial reporting as of May 2, 2026 has been audited by Ernst & Young LLP, independent registered public accounting firm, as stated in its report which is included in Item 8 of this Annual Report on Form 10-K. Changes in Internal Control over Financial Reporting No changes in our internal control over financial reporting (as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act) occurred during the quarter ended May 2, 2026 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting. Inherent Limitations on Effectiveness of Controls Our management, including our principal executive officer and principal financial officer, does not expect that our disclosure controls and procedures or our internal controls, will prevent all error and all fraud. A control system, no matter how well conceived and operated, can provide only reasonable, not absolute, assurance that the objectives of the control system are met. Further, the design of a control system must reflect the fact that there are resource constraints, and the benefits of controls must be considered relative to their costs. Because of the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that all control issues and instances of fraud, if any, within Credo have been detected . Item 9B. Other Information 10b5-1 Plans On March 20, 2026 , William J. Brennan , our Chief Executive Officer and a member of our board of directors terminated the Rule 10b5-1 Trading Plan Mr. Brennan adopted on April 15, 2025. 105 On April 8, 2026 , Yat Tung (Job) Lam , our Chief Operating Officer and a member of our board of directors terminated the Rule 10b5-1 Trading Plan Mr. Lam adopted on December 15, 2025. In addition, on April 15, 2026 , Mr. Lam adopted a Rule 10b5-1 Trading Plan, intended to satisfy the affirmative defense conditions of Rule 10b5-1(c) of the Exchange Act, pursuant to which a maximum amount of: (i) 200,000 of our ordinary shares held by Zhan (BVI) Co Ltd may be sold between July 15, 2026 and January 15, 2027 and (ii) 311,439 of our ordinary shares held directly by Mr. Lam may be sold between July 15, 2026 and January 15, 2027. The plan terminates on the earlier of: (i) January 15, 2027 , (ii) the first date on which all trades set forth in the plan have been executed or (iii) such date as the plan is otherwise terminated according to its terms. Mr. Lam and his spouse share voting and investment power over the shares held by Zhan (BVI) Co Ltd. On April 15, 2026 , Pantas Sutardja , a member of our board of directors , adopted a Rule 10b5-1 Trading Plan intended to satisfy the affirmative defense conditions of Rule 10b5-1(c) of the Exchange Act, pursuant to which a maximum amount of 1,540 of our ordinary shares held directly by Mr. Sutardja may be sold between October 14, 2026 and January 15, 2027. The plan terminates on the earlier of: (i) January 15, 2027 , (ii) the first date on which all trades set forth in the plan have been executed or (iii) such date as the plan is otherwise terminated according to its terms. Item 9C. Disclosure Regarding Foreign Jurisdictions that Prevent Inspections Not applicable. 106 PART III Item 10. Directors, Executive Officers and Corporate Governance The information required by this item is incorporated herein by reference to our 2026 Proxy Statement, which will be filed within 120 days after the end of the fiscal year to which the Annual Report on Form 10-K relates. Item 11. Executive Compensation The information required by this item is incorporated herein by reference to our 2026 Proxy Statement. Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Shareholder Matters The information required by this item is incorporated herein by reference to our 2026 Proxy Statement. Item 13. Certain Relationships and Related Transactions, and Director Independence The information required by this item is incorporated herein by reference to our 2026 Proxy Statement. Item 14. Principal Accounting Fees and Services The information required by this item is incorporated herein by reference to our 2026 Proxy Statement. 107 PART IV Item 15. Exhibits and Financial Statement Schedules (a) The following documents are filed as part of this Annual Report on Form 10-K: 1. Financial Statements: The financial statements required by this item are listed under Part II, Item 8, “Financial Statements and Supplementary Data” in this Annual Report on Form 10-K. 2. Financial Statement Schedules: All financial statement schedules have been omitted because they are not applicable or required, or the information required to be set forth therein is included in our consolidated financial statements or the notes thereto. 3. Exhibits: The following is a list of exhibits filed as part of this Annual Report on Form 10-K. EXHIBIT INDEX Incorporated by Reference Exhibit Number Description Form File Number Exhibit Filing Date Filed Herewith 3.1 Amended and Restated Memorandum and Articles of Association 8-K 001-41249 3.1 February 1, 2022 4.1 Fifth Amended and Restated Members Agreement, dated May 6, 2021 S-1 333-261982 4.1 January 3, 2022 4.2 Description of Share Capital 10-K 001-41249 4.2 June 8, 2022 10.1† Form of Indemnification Agreement entered into with each of the Registrant’s officers and directors S-1 333-261982 10.1 January 3, 2022 10.2† 2021 Long-Term Incentive Plan S-8 333-262358 99.1 January 27, 2022 10.3† Form of Notice of Stock Option Award and Stock Option Agreement under the 2021 Long-Term Incentive Plan S-1 333-261982 10.13 January 3, 2022 10.4† Form of Notice of RSU Award and RSU Agreement under the 2021 Long-Term Incentive Plan (Employees) S-1 333-261982 10.14 January 3, 2022 10.5† Form of Notice of RSU Award and RSU Agreement under the 2021 Long-Term Incentive Plan (Directors) S-1 333-261982 10.15 January 3, 2022 10.6 Amended and Restated Employee Stock Purchase Plan 10-K 001-41249 10.6 June 24, 2024 10.7# Warrant, dated December 28, 2021, issued to Amazon.com NV Investment Holdings LLC S-1/A 333-261982 10.17 January 18, 2022 10.8 Executive Incentive Compensation Plan 10-K 001-41249 10.8 June 24, 2024 10.9 Executive Change in Control Severance Plan 10-Q 001-41249 10.1 December 3, 2024 10.10 Form of Notice of PSU Award and PSU Agreement under the 2021 Long-Term Incentive Plan 10-Q 001-41249 10.2 March 10, 2025 108 10.11 Form of Notice of Special PSU Award and Special PSU Agreement under the 2021 Long-Term Incentive Plan X 19.1 Insider Trading Policy X 21.1 Subsidiaries of the Registrant X 23.1 Consent of Independent Registered Public Accounting Firm X 24.1 Power of Attorney (included on signature page) X 31.1 Certification of Principal Executive Officer pursuant to Rule 13a-14(a)/15d-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 X 31.2 Certification of Principal Financial Officer pursuant to Rule 13a-14(a)/15d-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 X 32.1* Certification of Principal Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 X 32.2* Certification of Principal Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 X 97.1 Compensation Recoupment Policy X 101.INS Inline XBRL Instance Document (the instance document does not appear in the Interactive Data File because XBRL tags are embedded within the Inline XBRL document) X 101.SCH Inline XBRL Taxonomy Extension Schema Document X 101.CAL Inline XBRL Taxonomy Extension Calculation Linkbase Document X 101.DEF Inline XBRL Taxonomy Extension Definition Linkbase Document X 101.LAB Inline XBRL Taxonomy Extension Label Linkbase Document X 101.PRE Inline XBRL Taxonomy Extension Presentation Linkbase Document X 104 Cover Page Interactive Data File (embedded within the Inline XBRL document) X _______________ † Indicates management contract or compensatory plan. # Portions of this exhibit (indicated by asterisks) have been redacted in compliance with Regulation S-K Item 601(b)(10)(iv) . * In accordance with Item 601(b)(32)(ii) of Regulation S-K and SEC Release No. 33-8238 and 34-47986, Final Rule: Management’s Reports on Internal Control Over Financial Reporting and Certification of Disclosure in Exchange Act Periodic Reports, the certifications furnished in Exhibits 32.1 and 32.2 hereto are deemed to accompany this Annual Report Form 10-K and will not be deemed “filed” for purposes of Section 18 of the Exchange Act. Such certifications will not be deemed to be incorporated by reference into any filings under the Securities Act or the Exchange Act, except to the extent that the registrant specifically incorporates it by reference. Item 16. Form 10-K Summary 109 None. 110 SIGNATURES Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, as amended, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized. CREDO TECHNOLOGY GROUP HOLDING LTD Date: June 15, 2026 By: /s/ William Brennan Name: William Brennan Title: President and Chief Executive Officer Date: June 15, 2026 By: /s/ Daniel Fleming Name: Daniel Fleming Title: Chief Financial Officer POWER OF ATTORNEY KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature appears below constitutes and appoints William Brennan and Daniel Fleming, and each of them individually, as his or her attorney-in-fact, each with full power of substitution, for him or her in any and all capacities, to sign any and all amendments to this Annual Report on Form 10-K, and to file the same, with exhibits thereto and all other documents in connection therewith, with the Securities and Exchange Commission, hereby ratifying and confirming all that said attorney-in-fact, or his substitute or substitutes, may do or cause to be done by virtue hereof. Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed by the following persons on behalf of the registrant in the capacities and on the dates indicated. Signature Title Date /s/ William Brennan President, Chief Executive Officer and Director (principal executive officer) June 15, 2026 William Brennan /s/ Daniel Fleming Chief Financial Officer (principal financial and accounting officer) June 15, 2026 Daniel Fleming /s/ Sylvia Acevedo Director June 15, 2026 Sylvia Acevedo /s/ Chi Fung Cheng Chief Technology Officer and Director June 15, 2026 Chi Fung Cheng /s/ Clyde Hosein Director June 15, 2026 Clyde Hosein /s/ Manpreet Khaira Director June 15, 2026 Manpreet Khaira /s/ Yat Tung Lam Chief Operating Officer and Director June 15, 2026 Yat Tung Lam 111 /s/ Pantas Sutardja Director June 15, 2026 Pantas Sutardja /s/ Brian Kelleher Director June 15, 2026 Brian Kelleher /s/ Fariba Danesh Director June 15, 2026 Fariba Danesh 112