Most investors with $1,000 available to buy stocks are chasing artificial intelligence (AI) exposure for their portfolios, and keep following the same handful of names. It's an understandable plan of action. It's the comfortable thing to do. But the next 10-bagger isn't likely to come from a company everyone already owns. You need to take the chase off the beaten path if you want strong, long-term returns.
I've been exploring the path that focuses on the connectivity layer of AI infrastructure, and the company I keep coming back to here is Credo Technology Group (CRDO +10.80%). Most people have probably never heard of Credo until this month, which is exactly why it might have 10-bagger potential.
On Tuesday, March 3, shares of Credo dropped sharply after earnings. The stock fell by more than 15% following the report's release, even as the company unveiled a slate of new products aimed directly at AI data center networks.
Image source: Getty Images.
Those announcements included Cardinal, a low-power 1.6T optical DSP built for massive-scale AI infrastructure; Robin, an 800G optical DSP for next-gen AI workloads; and a new line of 800G ZeroFlap optical transceivers. Credo makes high-speed interconnects that let the all-important graphics processing units (GPUs), which are the basis of most data centers, communicate between servers. Specifically, its Active Electrical Cables (AECs) and optical transceivers handle data movement at speeds up to 1.6 terabits per second. This is the kind of throughput that Nvidia's Vera Rubin and Blackwell semiconductor platforms demand.
When you hear about AI clusters scaling from 10,000 GPUs to 100,000 or more, the bottleneck isn't the chips. It's the plumbing between them. Credo builds that plumbing.
The recent financials back this up. This latest quarter, Credo reported fiscal 2026 Q3 revenue of $407 million (up 202% year over year) and EPS of $1.07 -- beating consensus analyst estimates on both metrics by significant amounts.
NASDAQ: CRDO
Key Data Points
A bullish acquisition for Credo
In September 2025, Credo quietly acquired Hyperlume, an Ottawa-based start-up building microLED optical interconnects for chip-to-chip communication. MicroLED uses ultra-fast, ultra-low-power light-emitting diodes to replace copper interconnects inside racks -- a technology that addresses the energy and bandwidth ceilings that even today's best optics are hitting.
Hyperlume had just raised $12.5 million in a seed round before Credo snatched it up. Then, in early 2026, Credo also acquired CoMira Solutions, a semiconductor IP firm specializing in link-layer and error correction IP, bolting that directly onto its ZeroFlap cable platform.
The 800-gigabyte cycle is in full swing right now, but Credo is already engineering for 1.6 terabytes. At the Optical Fiber Communication (OFC) Conference this week, Credo demonstrated its 3-nanometer Bluebird DSP driving 1.6T AECs inside Nvidia's next-generation Kyber Ultra NVL576 platform. The innovations these new products offer should excite investors.
To be clear, the risks are real with this ticker. Customer concentration is still high -- a handful of hyperscalers drive most of Credo's revenue. If Amazon or Microsoft shifted its connectivity strategy in-house, Credo would get hurt. And the stock has already pulled back about 50% from its 52-week high of $213.80.
But if you're putting $1,000 to work and investing with the idea of holding on for at least five years through the short-term volatility, Credo is the kind of company you might just want to own to get that 10-bagger return.
