CRDO Stock Hits 6-Month Low After MaxLinear Targets Credo-Dominated Cable Market

• Seendripu estimated that Credo currently accounts for 93% to 99% of the AEC cable market.
• He said MaxLinear plans to supply silicon components to cable manufacturers and focus its initial efforts on one or two large U.S. data centers.
• According to Futurum Equities strategist Shay Baloor, rapid AEC market growth could allow Credo to continue expanding even if it loses some market share.

Credo Technology (CRDO) shares dropped in morning trade on Friday to lows last seen in April in the face of new competitive pressure from MaxLinear (MXL). 

During MaxLinear’s third quarter (Q3) earnings call, CEO Kishore Seendripu said the company is targeting a 20% to 30% share of the 1.6-terabit (T) active electrical cable (AEC) market over the next couple of years,  a market where Credo currently dominates.

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Seendripu acknowledged that Credo accounts for an estimated 93% to 99% of the AEC cable market, but stated that the industry is beginning to diversify as the technology becomes more complex.

CRDO stock dropped around 10% in morning trade to hit a 6-month low before paring gains and was among the top trending tickers on Stocktwits at the time of writing. The shares are on track to post their third consecutive week in the red. MXL stock also moved lower in morning trade, dropping by around 1%. 

MaxLinear Targets 1.6T Active Electrical Cable Market

According to Seendripu, MaxLinear plans to supply silicon components to cable manufacturers and other suppliers rather than compete directly by producing complete cables. 

He said the company is focusing on one or two large U.S. data centers and expects to capture 20% to 30% of the 1.6T AEC market over the next couple of years. He added that MaxLinear does not expect to expand its efforts across multiple data centers.

Analyst Cuts MaxLinear Price Target Despite Guidance Increase

In a note to investors cited by TheFly, Susquehanna lowered its price target on MXL stock to $70 from $80 while maintaining a ‘Neutral’ rating. 

The firm cited continued upside from its optical digital signal processor (DSP) business noting that MaxLinear also increased its fiscal 2026 revenue guidance for its PAM-4 business, which is used in high-speed data transmission.

Meanwhile, Shay Baloor, the chief markets strategist at Futurum Equities, stated that investors may be underestimating the pace of growth in the AEC market.

“I think the market is overlooking how quickly AEC demand is growing because with market already expanding ~3x in a year and content per solution more than doubling at 1.6T that means Credo could lose some share and still deliver massive growth,” he wrote in a post on X.

How Is Retail Feeling About CRDO Stock?

Retail sentiment around CRDO stock on Stocktwits flipped to ‘bullish’ from ‘bearish’ territory over the past day and chatter jumped to ‘high’ from ‘normal’ levels. Platform data showed a 200% uptick in message volume over the last 24 hours.  

Meanwhile, sentiment around MXL stock shifted to ‘neutral’ from ‘bearish’ territory over the past day, with a jump in chatter to ‘high’ from ‘low’ levels.

Some retail traders on Stocktwits viewed the sell-off in CRDO stock as a buying opportunity, anticipating a potential rebound.

CRDO stock retained gains of around 5% year-to-date despite the sell-off.

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