---
title: "Credo answers Nvidia and Cisco with a rival AI cable spec, and loses 7.2% on the day"
description: "Hours after Nvidia and Cisco unveiled the USFP pluggable with connector makers TE Connectivity and Amphenol, Credo launched a rival optics specification and a 1.6T light cable. The stock still fell 7.2% on the day: the cable ships in 2027, two banks cut their targets, and insiders have sold $447 million in a year."
publisher: "The Inference"
section: "Hardware"
published: 2026-10-13T13:18:40.485Z
modified: 2026-10-13T13:18:40.485Z
canonical: https://theinference.org/article/credo-answers-nvidia-and-cisco-with-a-rival-ai-cable-spec-and-loses-7-2-on-the-day
language: en
keywords: "Nvidia, Cisco, Credo, Optics, Networking, Stocks"
---

# Credo answers Nvidia and Cisco with a rival AI cable spec, and loses 7.2% on the day

> Hours after Nvidia and Cisco unveiled the USFP pluggable with connector makers TE Connectivity and Amphenol, Credo launched a rival optics specification and a 1.6T light cable. The stock still fell 7.2% on the day: the cable ships in 2027, two banks cut their targets, and insiders have sold $447 million in a year.

## Two camps claimed the same connector on the same day

On October 12, at the Open Compute Project (OCP) summit in San Jose, [Cisco](https://theinference.org/markets/companies/cisco) and [Nvidia](https://theinference.org/markets/companies/nvidia) [announced design plans for the Ultra-Dense Small Form-Factor Pluggable (USFP)](https://blogs.cisco.com/news/cisco-and-nvidia-announce-usfp-expanding-the-path-to-ai-connectivity), the first pluggable optics form factor capable of 400 gigabits per lane, with 16 lanes and a path to 12.8 terabits [1]. The connector makers TE Connectivity (NYSE: TEL) and Amphenol (NYSE: APH) built it alongside them [2].

Hours later [Credo](https://theinference.org/markets/companies/credo) (NASDAQ: CRDO) opened the rival front: [a Short-Reach Micro-Emitter Optics (SRMO) workstream](https://www.businesswire.com/news/home/20261012753816/en/Credo-Launches-Short-Reach-Micro-Emitter-Optics-SRMO-Standardization-for-AI-Data-Center-Scale-Up-and-Scale-Out-Applications) under OCP, the body where hyperscalers publish their rack designs. Seven optical and cable component makers, AFL, ams OSRAM, BizLink, Foxlink, Heraeus Covantics, SENKO and YOFC, joined alongside an unnamed leading hyperscaler, with a specification targeted for OCP approval in 2027 [3].

The prize is the connector footprint written into those rack designs, because volume follows the specification: an open spec, [as TrendForce notes of the USFP camp](https://www.trendforce.com/news/2026/10/13/news-nvidia-cisco-target-4x-bandwidth-density-with-400g-usfp-optical-module-taiwan-suppliers-eye-gains/), cuts reliance on parts controlled by a few vendors and widens who can sell in [4]. [The listed names are the trade](https://theinference.org/article/ai-needs-faster-networks-these-five-stocks-get-paid-differently): CRDO against TEL and APH.

## The cable runs slow and wide

The product behind the workstream is Credo's [1.6T ZeroFlap active light cable](https://investors.credosemi.com/news-events/news/news-details/2026/Credo-Unveils-1-6T-ZeroFlap-Active-Light-Cable-Industrys-First-Row-Scale-Wide-Parallel-Optical-Interconnect-for-AI-Data-Centers/default.aspx) [5]: many micro-emitters running slow in parallel instead of a few lanes pushed fast. It draws 12 watts per cable end, about 30% less than comparable active electrical cables, at a tenth of the weight and 50 meters of reach, against a 100-million-hour reliability target, and it ships in 2027 [5].

The bet needs an ecosystem around it. Clusters scaling from thousands to tens of thousands of accelerators require "not a patchwork of components that do not fit together or interoperate," says L.K. Bhupathi, Credo's associate vice president of product [3].

## The market sold the answer

CRDO fell 7.2% to $200.84, about 35% below its 52-week high of $308.67 [6]. Stifel and Mizuho [cut their price targets on the day](https://www.streetinsider.com/Investing/Credo+Technology+shares+fall+despite+new+product+launch/27174869.html) and kept bullish ratings [7]; Stifel's remains the street high at $350 [10].

*Chart: **The stock sits 35% below its high, and the street high is $350** Bar chart comparing Credo's share price, its 52-week high and Stifel's street-high price target.*

*Share price at the October 12 close, 52-week high, and the street-high price target (Stifel), US dollars. Sources: GuruFocus, StreetInsider, 24/7 Wall St [6][7][10]*

Insiders [sold $447.1 million of stock over twelve months](https://www.gurufocus.com/news/9119942/credo-technology-group-holding-ltd-crdo-shares-fall-72-what-gf-score-of-84-tells-investors) with no purchases [6], among them chief technology officer Chi Fung Cheng, whose 27,500 shares [went for $5.3 million on September 29](https://finance.yahoo.com/markets/stocks/articles/credo-technology-group-holding-insider-205526335.html) [8]. The company says the recent sales ran through pre-arranged 10b5-1 plans tied to tax on vested equity [7]. They land on a business whose quarterly revenue climbed from $44 million to $479 million in three years [9].

*Chart: **Quarterly revenue has grown almost elevenfold in three years** Line chart of Credo's quarterly revenue from Q3 2023 to Q2 2026, rising from $44 million to $479 million.*

*Quarterly revenue, US$ millions, from Credo's SEC filings; Q2 2026 is the quarter ended August 1, 2026 [9]*

## What decides it

Credo [guided the current quarter to $525 million to $535 million](https://247wallst.com/investing/2026/09/21/credo-technology-crashed-for-3-months-this-wall-street-pro-says-its-about-to-double/) [10]. The SRMO specification faces its OCP vote in 2027, the same year the cable ships [3][5]. The unnamed hyperscaler in the workstream is the tell: name it, and Credo's coalition has a committed buyer.

The other side of the book is concentration: two customers carry 61% of revenue, a third of sales in the largest [10], and a lost vote would land there first. The dates break one way: Credo has put 2027 on both its cable and its spec [3][5], while Cisco and Nvidia have announced design plans and no ship date [1].

## Takeaway

Credo's rival spec and 1.6T cable are both a 2027 story, and the market marked the timing risk the same day: the stock fell 7.2%, two banks cut targets, and the unnamed hyperscaler in the workstream is the tell that decides whether the coalition has a committed buyer.

## Sources

1. [Cisco Blogs, "Cisco and NVIDIA Announce USFP: Expanding the Path to AI Connectivity", 12 October 2026](https://blogs.cisco.com/news/cisco-and-nvidia-announce-usfp-expanding-the-path-to-ai-connectivity)
2. [SDxCentral, "Cisco nabs Nvidia for pluggable power up, snuggles closer to SONiC", 12 October 2026](https://www.sdxcentral.com/news/cisco-nabs-nvidia-for-pluggable-power-up-snuggles-closer-to-sonic/)
3. [Business Wire, "Credo Launches Short-Reach Micro-Emitter Optics (SRMO) Standardization for AI Data Center Scale-Up and Scale-Out Applications", 12 October 2026](https://www.businesswire.com/news/home/20261012753816/en/Credo-Launches-Short-Reach-Micro-Emitter-Optics-SRMO-Standardization-for-AI-Data-Center-Scale-Up-and-Scale-Out-Applications)
4. [TrendForce News, "NVIDIA, Cisco Target 4x Bandwidth Density With 400G USFP Optical Module; Taiwan Suppliers Eye Gains", 13 October 2026](https://www.trendforce.com/news/2026/10/13/news-nvidia-cisco-target-4x-bandwidth-density-with-400g-usfp-optical-module-taiwan-suppliers-eye-gains/)
5. [Credo Technology Group Investor Relations, "Credo Unveils 1.6T ZeroFlap Active Light Cable, Industry's First Row-Scale, Wide-Parallel Optical Interconnect for AI Data Centers", 12 October 2026](https://investors.credosemi.com/news-events/news/news-details/2026/Credo-Unveils-1-6T-ZeroFlap-Active-Light-Cable-Industrys-First-Row-Scale-Wide-Parallel-Optical-Interconnect-for-AI-Data-Centers/default.aspx)
6. [GuruFocus, "Credo Technology Group Holding Ltd (CRDO) Shares Fall 7.2% -- What GF Score of 84 Tells Investors", 12 October 2026](https://www.gurufocus.com/news/9119942/credo-technology-group-holding-ltd-crdo-shares-fall-72-what-gf-score-of-84-tells-investors)
7. [StreetInsider, "Credo Technology shares fall despite new product launch", 12 October 2026](https://www.streetinsider.com/Investing/Credo+Technology+shares+fall+despite+new+product+launch/27174869.html)
8. [Yahoo Finance / MT Newswires, "Credo Technology Group Holding Insider Sold Shares Worth $5,333,158, According to a Recent SEC Filing", 1 October 2026](https://finance.yahoo.com/markets/stocks/articles/credo-technology-group-holding-insider-205526335.html)
9. [Credo Technology Group, quarterly figures from its SEC filings, retrieved 13 October 2026](https://www.sec.gov/cgi-bin/browse-edgar?action=getcompany&CIK=0001807794)
10. [24/7 Wall St, "Credo Technology Crashed for 3 Months: This Wall Street Pro Says It's About to Double", 21 September 2026](https://247wallst.com/investing/2026/09/21/credo-technology-crashed-for-3-months-this-wall-street-pro-says-its-about-to-double/)


---

Credo answers Nvidia and Cisco with a rival AI cable spec, and loses 7.2% on the day — The Inference. Canonical: https://theinference.org/article/credo-answers-nvidia-and-cisco-with-a-rival-ai-cable-spec-and-loses-7-2-on-the-day