CREDO TECHNOLOGY GROUP HOLDING LTD CONSOLIDATED FINANCIAL STATEMENTS Content Page Report of Independent Registered Public Accounting Firm (PCAOB ID: 42) 71 Consolidated Balance Sheets 75 Consolidated Statements of Operations 76 Consolidated Statements of Comprehensive Income (Loss) 77 Consolidated Statements Shareholders’ Equity 78 Consolidated Statements of Cash Flows 79 Notes to Consolidated Financial Statements 80 70 REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM To the Shareholders and the Board of Directors of Credo Technology Group Holding Ltd Opinion on the Financial Statements We have audited the accompanying consolidated balance sheets of Credo Technology Group Holding Ltd (the Company) as of May 2, 2026 and May 3, 2025, the related consolidated statements of operations, comprehensive income (loss), shareholders' equity and cash flows for each of the three years in the period ended May 2, 2026, and the related notes (collectively referred to as the “consolidated financial statements”). In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company at May 2, 2026 and May 3, 2025, and the results of its operations and its cash flows for each of the three years in the period ended May 2, 2026, in conformity with U.S. generally accepted accounting principles. We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the Company's internal control over financial reporting as of May 2, 2026, based on criteria established in Internal Control—Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (2013 framework), and our report dated June 15, 2026 expressed an unqualified opinion thereon. Basis for Opinion These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on the Company’s financial statements based on our audits. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB. We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audits provide a reasonable basis for our opinion. Critical Audit Matter The critical audit matter communicated below is a matter arising from the current period audit of the financial statements that was communicated or required to be communicated to the audit committee and that: (1) relates to accounts or disclosures that are material to the financial statements and (2) involved our especially challenging, subjective or complex judgments. The communication of the critical audit matter does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing a separate opinion on the critical audit matter or on the account or disclosure to which it relates. 71 Inventory Valuation Description of the Matter The Company’s inventories totaled $250.8 million as of May 2, 2026, representing 10.9% of total assets. As explained in Note 2 to the consolidated financial statements, the Company values inventories at the lower of cost and net realizable value in each reporting period. Excess and obsolete inventory is written down to its estimated net realizable value if less than cost. Auditing management’s estimates for net realizable value of excess and obsolete inventory involved subjective auditor judgment because management’s assessment of whether a write down is required and the measurement of any excess of cost over net realizable value is judgmental and considers qualitative factors that are affected by market and economic conditions outside the Company’s control. In particular, the excess and obsolete inventory calculations are sensitive to significant assumptions, including demand for the Company’s products, which considers adjustments to sales forecasts for specific product considerations, including but not limited to new product launches. How We Addressed the Matter in Our Audit We obtained an understanding, evaluated the design, and tested the operating effectiveness of internal controls over the Company's excess and obsolete inventory write-down process. This included controls over management’s assessment of net realizable value, including the determination of forecasted usage of inventories. Our audit procedures included, among others, evaluating the product demand assumptions stated above and testing the completeness and accuracy of the underlying data used in management’s excess and obsolete inventory valuation assessment. We evaluated inventory levels compared to forecasted product demand, historical sales and specific product considerations. We also assessed the historical accuracy of management’s estimates and performed sensitivity analyses over the product demand assumptions to evaluate the changes in the excess and obsolete inventory estimates that would result from changes in the underlying assumptions. /s/ Ernst & Young LLP We have served as the Company’s auditor since 2018. San Jose, California June 15, 2026 72 Report of Independent Registered Public Accounting Firm To the Shareholders and the Board of Directors of Credo Technology Group Holding Ltd Opinion on Internal Control Over Financial Reporting We have audited Credo Technology Group Holding Ltd’s internal control over financial reporting as of May 2, 2026, based on criteria established in Internal Control—Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (2013 framework) (the COSO criteria). In our opinion, Credo Technology Group Holding Ltd (the Company) maintained, in all material respects, effective internal control over financial reporting as of May 2, 2026, based on the COSO criteria. We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the consolidated balance sheets of the Company as of May 2, 2026 and May 3, 2025, the related consolidated statements of operations, comprehensive income (loss), shareholders' equity and cash flows for each of the three years in the period ended May 2, 2026, and the related notes and our report dated June 15, 2026 expressed an unqualified opinion thereon. Basis for Opinion The Company’s management is responsible for maintaining effective internal control over financial reporting and for its assessment of the effectiveness of internal control over financial reporting included in the accompanying Management’s Annual Report on Internal Control over Financial Reporting. Our responsibility is to express an opinion on the Company’s internal control over financial reporting based on our audit. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB. We conducted our audit in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether effective internal control over financial reporting was maintained in all material respects. Our audit included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, testing and evaluating the design and operating effectiveness of internal control based on the assessed risk, and performing such other procedures as we considered necessary in the circumstances. We believe that our audit provides a reasonable basis for our opinion. Definition and Limitations of Internal Control Over Financial Reporting A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements. Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate. 73 /s/ Ernst & Young LLP San Jose, California June 15, 2026 74 Credo Technology Group Holding Ltd Consolidated Balance Sheets (in thousands, except per share amounts) May 2, 2026 May 3, 2025 Assets Current assets: Cash and cash equivalents $ 1,164,952 $ 236,328 Short-term investments 278,334 195,010 Accounts receivable 233,377 162,144 Inventories 250,831 90,029 Other current assets 73,576 30,023 Total current assets 2,001,070 713,534 Property and equipment, net 101,605 63,631 Right of use assets 24,640 15,234 Goodwill 92,798 — Intangible assets, net 29,262 — Other non-current assets 46,244 16,858 Total assets $ 2,295,619 $ 809,257 Liabilities and Shareholders' Equity Current liabilities: Accounts payable $ 107,345 $ 56,158 Accrued compensation and benefits 21,626 16,097 Other current liabilities 68,120 35,456 Total current liabilities 197,091 107,711 Non-current operating lease liabilities 20,617 12,693 Other non-current liabilities 14,299 7,271 Total liabilities 232,007 127,675 Commitments and contingencies (Note 9) Shareholders' equity: Ordinary shares, $0.00005 par value; 1,000,000 shares authorized; 185,419 and 171,169 shares issued and outstanding at May 2, 2026 and May 3, 2025, respectively 9 8 Additional paid in capital 1,672,060 765,173 Accumulated other comprehensive income (loss) 2,426 (437) Retained earnings (accumulated deficit) 389,117 (83,162) Total shareholders' equity 2,063,612 681,582 Total liabilities and shareholders' equity $ 2,295,619 $ 809,257 The accompanying notes are an integral part of these consolidated financial statements. 75 Credo Technology Group Holding Ltd Consolidated Statements of Operations (in thousands, except per share amounts) Year Ended May 2, 2026 May 3, 2025 April 27, 2024 Revenue $ 1,335,116 $ 436,775 $ 192,970 Cost of revenue 426,767 153,866 73,539 Gross profit 908,349 282,909 119,431 Operating expenses: Research and development 279,381 146,867 96,296 Selling, general and administrative 183,963 98,918 60,193 Total operating expenses 463,344 245,785 156,489 Operating income (loss) 445,005 37,124 (37,058) Other income, net 30,430 17,746 14,313 Income (loss) before income taxes 475,435 54,870 (22,745) Provision for income taxes 3,156 2,687 5,624 Net income (loss) $ 472,279 $ 52,183 $ (28,369) Net income (loss) per share: Basic $ 2.65 $ 0.31 $ (0.18) Diluted $ 2.51 $ 0.29 $ (0.18) Weighted-average shares used in computing net income (loss) per share: Basic 178,538 167,505 155,091 Diluted 188,232 181,158 155,091 The accompanying notes are an integral part of these consolidated financial statements. 76 Credo Technology Group Holding Ltd Consolidated Statements of Comprehensive Income (Loss) (in thousands) Year Ended May 2, 2026 May 3, 2025 April 27, 2024 Net income (loss) $ 472,279 $ 52,183 $ (28,369) Other comprehensive income (loss): Foreign currency translation income (loss) 2,863 82 (328) Total comprehensive income (loss) $ 475,142 $ 52,265 $ (28,697) The accompanying notes are an integral part of these consolidated financial statements. 77 Credo Technology Group Holding Ltd Consolidated Statements of Shareholders’ Equity (in thousands) Ordinary Shares Additional Paid-in Capital Accumulated Other Comprehensive Income (Loss) Retained Earnings (Accumulated Deficit) Total Shareholders’ Equity Number of Shares Amount Balances at April 29, 2023 148,651 $ 7 $ 454,795 $ (191) $ (106,976) $ 347,635 Issuance of ordinary shares in connection with secondary public offering, net of offering costs 10,440 1 173,415 — 173,416 Ordinary shares issued under equity incentive plans 5,329 — 7,055 — — 7,055 Tax withheld related to RSU settlement (115) — (2,158) — — (2,158) Share-based compensation — — 39,022 — — 39,022 Warrant contra revenue — — 3,925 — — 3,925 Total comprehensive loss — — — (328) (28,369) (28,697) Balances at April 27, 2024 164,305 $ 8 $ 676,054 $ (519) $ (135,345) $ 540,198 Ordinary shares issued under equity incentive plans 7,057 — 7,831 — — 7,831 Tax withheld related to RSU settlement (194) — (9,253) — — (9,253) Share-based compensation — — 77,355 — — 77,355 Warrant contra revenue — — 13,186 — — 13,186 Total comprehensive income — — — 82 52,183 52,265 Balances at May 3, 2025 171,169 $ 8 $ 765,173 $ (437) $ (83,162) $ 681,582 Ordinary shares issued under At-The-Market Offering, net of issuance costs 4,820 — 736,327 — — 736,327 Ordinary shares issued upon exercise of Customer Warrant 3,761 — — — — — Ordinary shares issued under equity incentive plans 5,835 1 7,083 — — 7,084 Tax withheld related to RSU settlement (166) — (19,161) — — (19,161) Share-based compensation — — 182,638 — — 182,638 Total comprehensive income — — — 2,863 472,279 475,142 Balances at May 2, 2026 185,419 $ 9 $ 1,672,060 $ 2,426 $ 389,117 $ 2,063,612 The accompanying notes are an integral part of these consolidated financial statements. 78 Credo Technology Group Holding Ltd Consolidated Statements of Cash Flows (in thousands) Year Ended May 2, 2026 May 3, 2025 April 27, 2024 Cash flows from operating activities: Net income (loss) $ 472,279 $ 52,183 $ (28,369) Adjustments to reconcile net income (loss) to net cash provided by operating activities: Depreciation and amortization 34,637 21,938 13,771 Amortization of acquired intangible assets 400 — — Share-based compensation 182,638 77,355 39,022 Warrant contra revenue — 13,186 3,925 Write-downs for excess and obsolete inventory 15,116 7,952 4,354 Impairment of assets 1,500 873 765 Changes in operating assets and liabilities Accounts receivable (70,798) (102,482) (10,121) Inventories (174,036) (70,470) 15,762 Other current assets (44,801) 4,596 (19,836) Other non-current assets (26,453) 2,089 (654) Accounts payable 48,752 41,930 8,806 Accrued compensation and benefits, other current liabilities and other non-current liabilities 25,058 15,933 5,312 Net cash provided by operating activities 464,292 65,083 32,737 Cash flows from investing activities: Purchases of property and equipment (57,296) (36,061) (15,652) Purchases of short-term investments (393,334) (258,726) (403,587) Maturities of short-term investments 310,010 406,777 169,754 Business acquisitions, net of cash acquired (112,908) — — Net cash provided by (used in) investing activities (253,528) 111,990 (249,485) Cash flows from financing activities: Proceeds from issuance of ordinary shares in connection with public offerings, net of offering costs 736,327 — 173,431 Payments on technology license obligations (6,624) (6,306) (3,052) Proceeds from equity incentive plans 7,083 7,831 7,055 Tax withheld related to RSU settlement (19,157) (9,253) (2,158) Net cash provided by (used in) financing activities 717,629 (7,728) 175,276 Effect of exchange rate changes on cash 231 41 (169) Net increase (decrease) in cash and cash equivalents 928,624 169,386 (41,641) Cash and cash equivalents at beginning of the year 236,328 66,942 108,583 Cash and cash equivalents at end of the year $ 1,164,952 $ 236,328 $ 66,942 Supplemental cash flow information: Income taxes paid $ 2,472 $ 1,447 $ 1,054 Purchases of property and equipment included in accounts payable, other current liabilities and other non-current liabilities $ 16,106 $ 8,877 $ 8,287 The accompanying notes are an integral part of these consolidated financial statements. 79 Credo Technology Group Holding Ltd Notes to Consolidated Financial Statements 1. Description of Business and Basis of Presentation Credo Technology Group Holding Ltd was formed as an exempted company under the laws of the Cayman Islands in September 2014. Credo Technology Group Holding Ltd directly owns Credo Technology Group Ltd., which owns, directly and indirectly, all of the shares of its subsidiaries in the United States (U.S.), Singapore, mainland China, Hong Kong, Taiwan and Canada. References to the “Company” in these notes refer to Credo Technology Group Holding Ltd and its subsidiaries on a consolidated basis, unless otherwise specified. The Company’s mission is to transform connectivity at scale through fast, reliable and energy-efficient system solutions. The Company’s highspeed copper and optical interconnect products deliver industry-leading power and performance at up to 1.6T to meet the ever-expanding data infrastructure demands of AI. The Company’s product portfolio includes ZeroFlap (ZF) Active Electrical Cables (AECs) and ZF optical transceivers, OmniConnect memory solutions and a suite of retimers and DSPs for optical and copper Ethernet and PCIe, all leveraging the Company’s PILOT diagnostic and analytics software platform. The Company’s innovations enable our customers to connect the systems that connect the world. Basis of Presentation These consolidated financial statements have been prepared in accordance with generally accepted accounting principles in the United States (GAAP). The consolidated financial statements include the results of Credo Technology Group Holding Ltd and its wholly-owned subsidiaries. All intercompany balances and transactions have been eliminated in consolidation. The Company’s fiscal year is a 52- or 53-week period ending on the Saturday closest to April 30. The additional week in a 53-week year is added to the first quarter, making such quarter consist of 14 weeks. Accordingly, every fifth or sixth fiscal year will have a 53-week period. The fiscal years ended May 2, 2026 (fiscal year 2026) and April 27, 2024 (fiscal year 2024) were both 52-week fiscal years. The fiscal year ended May 3, 2025 (fiscal year 2025) was a 53-week fiscal year. Reclassifications Certain prior period balances were reclassified to conform to the current period’s presentation. None of these reclassifications had an impact on reported net income (loss) or cash flows for any of the periods presented. ATM Offering In October 2025, the Company entered into an equity distribution agreement with Goldman Sachs & Co. LLC related to the sale from time to time of the Company’s ordinary shares for an aggregate offering price of up to $750 million (the ATM Offering). During the fiscal year ended May 2, 2026, the Company completed the ATM Offering and received $736.3 million in net proceeds through an issuance of 4.8 million ordinary shares. The total issuance costs were $13.7 million. 2. Significant Accounting Policies Use of Estimates The preparation of these consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the amounts reported in the Company’s consolidated financial statements and accompanying notes. The Company bases its estimates and judgments on historical experience, knowledge of current conditions and beliefs of what could occur in the future, given the available information. Estimates are used for, but not limited to, write-down for excess and obsolete inventories, variable consideration from 80 Credo Technology Group Holding Ltd Notes to Consolidated Financial Statements revenue contracts, determination of the fair value of share-based awards, the realizability of tax assets and estimates of tax reserves, valuation of acquired intangible assets, impairment of long-lived assets and goodwill (as applicable) and incremental borrowing rate used in the Company’s operating lease calculations. Actual results may differ from those estimates and such differences may be material to the financial statements. As new events continue to evolve and additional information becomes available, any changes to these estimates and assumptions will be recognized in the consolidated financial statements as soon as they become known. Foreign Currency All of the Company’s subsidiaries use U.S. dollars as their functional currency, except for its entities located in Taiwan, Canada and mainland China. The functional currencies of these entities are their respective local currency. Foreign currency assets and liabilities are remeasured into the functional currencies at the end-of-period exchange rates except for non-monetary assets and liabilities, which are remeasured at historical exchange rates. Revenue and expenses are remeasured at the exchange rates in effect during the period the transactions occurred, except for those expenses related to balance sheet amounts, which are remeasured at historical exchange rates. Gains or losses from foreign currency transactions are included in the consolidated statements of operations as part of ‘other income, net’. Translation gains and losses are recorded in accumulated other comprehensive income as a component of shareholders' equity. Cash, Cash Equivalents and Short-term Investments Cash and cash equivalents are highly liquid investments with insignificant interest rate risk and maturities of three months or less at the time of acquisition. Cash and cash equivalents consist primarily of cash balances in the Company’s bank checking and savings accounts, and government and institutional money market funds. Investments not considered cash equivalents and with maturities of one year or less from the consolidated balance sheet date are classified as short-term investments. Short-term investments consist of certificates of deposit with original maturity dates between three and twelve months. The classification of our short-term investments is determined at the time of purchase, and such determination is reevaluated at each balance sheet date. Our short-term investments include certificates of deposit, which are classified as held-to-maturity. These investments are recorded at amortized cost basis. If the cost of an individual investment exceeds its fair value, we evaluate, among other factors, general market conditions, the duration and extent to which the fair value is less than cost, and our intent and ability to hold the investment. Once a decline in fair value is determined to be other-than-temporary, an impairment charge is recorded and a new cost basis in the investment is established. Business Combinations The Company allocates the fair value of the purchase consideration of its business acquisitions to the tangible assets, liabilities and intangible assets acquired, including developed technology and in-process research and development (IPR&D), based on their estimated fair values under the acquisition method of accounting. The excess of the fair value of purchase consideration over the fair values of these identifiable assets and liabilities is recorded as goodwill. The estimates and assumptions used in valuing intangible assets include, but are not limited to, the amount and period involved in recreating the acquired intangible assets, discount rate used to determine the present value and asset lives. These estimates are inherently uncertain and, therefore, actual results may differ from the estimates made. Acquisition-related expenses are recognized separately from the business combination and are expensed as incurred. Accounts Receivable Accounts receivable are recorded at the invoiced amount, net of allowance for credit losses. The Company performs periodic credit evaluations of its customers’ financial condition and does not require 81 Credo Technology Group Holding Ltd Notes to Consolidated Financial Statements collateral from them. The Company assesses the collectability by reviewing accounts receivable on a customer-by-customer basis. To manage credit risk, management performs ongoing credit evaluations of the customers’ financial condition, monitors payment performance, and assesses current economic conditions, as well as reasonable and supportable forecasts of future economic conditions, that may affect collectability of the outstanding receivables. Management does not believe that an allowance for credit losses is needed as of May 2, 2026 or May 3, 2025 based on review of credit worthiness of the customers and their payment histories. Inventory The Company values its inventory, which includes raw materials, assembly and test, and other manufacturing costs, at the lower of cost and net realizable value. Cost is computed using standard cost, which approximates actual cost, on a first-in, first-out basis. Net realizable value is the estimated selling price of the Company’s products in the ordinary course of business, less reasonably predictable costs of completion, disposal and transportation. The Company regularly reviews inventory quantities on hand and records write-downs for excess and obsolete inventory based primarily on the shipment history and its estimated forecast of product demand. These factors are impacted by market and economic conditions, technology changes, new product introductions and changes in strategic direction. If the future demand for the Company’s services and products is less favorable than the Company’s forecasts, the value of the inventories may be required to be reduced, which could result in additional expense to the Company and affect its results of operations. Once inventory is written down, its new value is maintained until it is sold, scrapped, or written down for further valuation losses. Property and Equipment, Net Property and equipment are stated at cost, net of accumulated depreciation and amortization. Additions, improvements and major renewals are capitalized, and maintenance, repairs and minor renewals are expensed as incurred. Assets are held in construction in progress until placed in service, upon which date, the Company begins to depreciate these assets. When assets are retired or otherwise disposed of, the cost and accumulated depreciation are removed from the accounts and any resulting gain or loss is reflected in the consolidated statements of income in the period realized. Depreciation and amortization is computed using the straight-line method over the estimated useful lives of the assets. Useful lives by asset category are as follows: Asset Category Useful Life (in years) Computer equipment and software 3 Laboratory equipment 5 Production equipment 2 - 7 Leasehold improvements 5 or remaining lease term Leases The Company determines if an arrangement is a lease at inception. Operating lease right-of-use (ROU) assets and liabilities are recognized at the commencement date of the lease based on the present value of lease payments over the lease term. Operating lease ROU assets also include any initial direct costs and prepayments less lease incentives. Lease terms may include options to extend or terminate the lease when it is reasonably certain that the Company will exercise such options. As the Company's leases do not provide an implicit rate, the Company uses its collateralized incremental borrowing rate based on the information available at the lease commencement date, including lease term, in determining the present value of lease payments. Lease expense for these leases is recognized on a straight line basis over the lease term. Goodwill 82 Credo Technology Group Holding Ltd Notes to Consolidated Financial Statements Goodwill is recorded when the consideration paid for a business acquisition exceeds the fair value of net tangible and intangible assets acquired. Goodwill is measured and tested for impairment annually on the last business day of the fiscal fourth quarter and whenever events or changes in circumstances indicate the carrying amount of goodwill may not be recoverable. The Company first assesses qualitative factors to determine whether it is more likely than not that the fair value of a reporting unit is less than its carrying amount or the Company may determine to proceed directly to the quantitative impairment test. If the Company assesses qualitative factors and concludes that it is more likely than not that the fair value of a reporting unit is less than its carrying amount or if the Company determines not to use the qualitative assessment, then a quantitative impairment test is performed. The quantitative impairment test requires comparing the fair value of the reporting unit to its carrying value, including goodwill. The Company has identified that its business operates as a single operating segment and as a single reporting unit for the purpose of goodwill impairment testing. An impairment exists if the fair value of the reporting unit is lower than its carrying value. If the fair value of the reporting unit is lower than its carrying value, the Company would record an impairment loss in the fiscal quarter in which the determination is made. Impairment of Long-lived Assets The Company assesses the impairment of long-lived assets, which consist primarily of property and equipment and intangible assets whenever events or changes in circumstances indicate that such assets might be impaired and the carrying value may not be recoverable. Events or changes in circumstances that may indicate that an asset is impaired include significant decreases in the market value of an asset, significant underperformance relative to expected historical or projected future results of operations, a change in the extent or manner in which an asset is utilized, significant declines in the estimated fair value of the overall Company for a sustained period, shifts in technology, loss of key management or personnel, changes in the Company’s operating model or strategy and competitive forces. If events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable and the expected undiscounted future cash flows attributable to the asset are less than the carrying amount of the asset, an impairment loss equal to the excess of the asset’s carrying value over its fair value is recorded. Fair value is determined based on the present value of estimated expected future cash flows using a discount rate commensurate with the risk involved, quoted market prices or appraised values, depending on the nature of the asset. Revenue Recognition The Company’s customers are primarily original equipment manufacturers who design and manufacture end market devices for the communications and enterprise networks markets. The Company’s revenue is driven by various trends in these markets. The Company recognizes revenue upon transfer of control of promised goods and services in an amount that reflects the consideration it expects to receive in exchange for those goods and services. The Company also considers the constraint on estimates of variable consideration when estimating the total transaction price. The Company’s policy is to record revenue net of any applicable sales, use or excise taxes. Changes in the Company’s contract assets and contract liabilities primarily result from the timing difference between the Company’s performance and the customer’s payment. The Company fulfills its obligations under a contract with a customer by transferring products or services in exchange for consideration from the customer. The Company recognizes a contract asset when it transfers products or services to a customer and the right to consideration is conditional on something other than the passage of time. Accounts receivable are recorded when the customer has been billed or the right to consideration is unconditional other than the passage of time. The Company recognizes deferred revenue when it has received consideration or an amount of consideration is due from the customer and it has a future obligation to transfer products. 83 Credo Technology Group Holding Ltd Notes to Consolidated Financial Statements The Company transacts with customers primarily pursuant to standard purchase orders for delivery of products and generally allows customers to cancel or change purchase orders within limited notice periods prior to the scheduled shipment date. The Company offers standard performance warranties of twelve months after product delivery and offers limited product return rights to certain distributors. The Company recognizes product sales when it transfers control of promised goods in an amount that reflects the consideration to which it expects to be entitled to in exchange for those goods, net of accruals for estimated sales returns and rebates. As of May 2, 2026 and May 3, 2025, the sales returns and rebate reserves were not material. Customer Warrant The Company accounts for the warrant issued to Amazon.com NV Investment Holdings LLC as an equity instrument, based on the specific terms of the warrant agreement. When management determines that it is probable that a tranche of the warrant will vest and we recognize the related revenue, the grant date fair value of the associated tranche will be recognized in shareholders’ equity and the underlying expense amortized as a reduction of revenue in proportion to the amount of related revenue recognized. Cost of Revenue Cost of revenue includes cost of materials, including wafers processed by third-party foundries, cost associated with packaging and assembly, testing and shipping, cost of personnel, including share-based compensation, depreciation of equipment associated with manufacturing support, logistics and quality assurance, warranty cost, amortization of intellectual property purchased from third-parties, write-down of inventories, and amortization and impairment of production equipment no longer in use. Shipping and Handling Costs Shipping and handling costs incurred for delivery to customers are expensed as incurred and are included in selling, general and administrative expenses in the Company’s consolidated statements of operations. Research and Development Research and development expenses consist of costs incurred in performing research and development activities and includes salaries, share-based compensation, employee benefits, occupancy costs, pre-production engineering mask costs, and prototype wafer, packaging and test costs. Research and development costs are expensed as incurred. Share-Based Compensation The Company records compensation expense in connection with share-based awards granted to employees and non-employees in accordance with guidance related to share-based payments. This guidance requires that all share-based compensation be recognized as an expense in the consolidated financial statements and that such cost be measured at the fair value of the award. The Company generally amortizes share-based compensation expense under the straight-line attribution method over the vesting period of the share-based award. For performance-based awards, the Company amortizes share-based compensation expense under the graded vesting method over the vesting period of the award. The Company has elected to use the Black-Scholes option pricing model to determine the fair value of ordinary share options on the dates of grant. Calculating the fair value of share options using the Black-Scholes model requires inputs and assumptions, including the fair value of the Company’s ordinary shares, the expected term of share options and share price volatility. The Company estimates the expected life of options granted based on the simplified method. The Company estimates the volatility of its ordinary shares on the date of grant based on the Company’s historical stock price volatility. The Company has not paid and has no current plans to pay dividends. The Company accounts for forfeitures as they occur. 84 Credo Technology Group Holding Ltd Notes to Consolidated Financial Statements The fair value of each restricted share unit is estimated based on the market price of the Company’s ordinary share on the date of grant. The fair value of each share issued under the Company’s employee share purchase plan is estimated based on the Black-Scholes option pricing model. Income Taxes The Company is subject to income taxes in the United States and certain foreign jurisdictions. Significant judgment is required in determining the Company’s provision for income taxes and income tax assets and liabilities, including evaluating uncertainties in the application of accounting principles and complex tax laws. The Company uses the asset and liability method to account for income taxes. Current income tax expense or benefit represents the amount of income taxes expected to be payable or refundable for the current year. Under this method, deferred income tax assets and liabilities are determined based on differences between the financial statement reporting and tax bases of assets and liabilities and net operating loss and credit carryforward. Deferred tax assets and liabilities are measured using enacted tax rates applied to taxable income in the years in which those temporary differences are expected to be recovered or settled. A valuation allowance is established when necessary to reduce deferred tax assets to the amount expected to be realized. The Company accounts for uncertain tax positions in accordance with ASC 740‑10, Accounting for Uncertainty in Income Taxes. The Company recognizes the tax effects of an uncertain tax position only if such position is more likely than not to be sustained based solely on its 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. Interest and penalties related to uncertain tax positions are classified in the consolidated financial statements as income tax expense. Net Income (Loss) Per Share Basic net income (loss) per share is computed using the weighted average number of ordinary shares outstanding during the period. Diluted net income (loss) per share is computed using the weighted average number of ordinary and potentially dilutive shares outstanding during the period using the treasury stock method. Under the treasury stock method, the effect of equity awards outstanding is not included in the computation of diluted net income (loss) per share for periods when their effect is anti-dilutive. Segment Information Operating segments are identified as components of an enterprise about which discrete financial information is available for evaluation by the chief operating decision-maker (CODM) in deciding resource allocation and assessing performance. The Company’s Chief Executive Officer is its CODM. The Company’s CODM reviews financial information presented on a consolidated basis for the purposes of making operating decisions, allocating resources and evaluating financial performance. Consequently, the Company has determined it operates and manages its business in one operating and one reportable segment. See “Note 15. Segment and Geographic Information” for the Company’s revenue by country and location of long-lived assets. Accounting Pronouncement Recently Adopted In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740) Improvements to Income Tax Disclosures, which requires disclosure of disaggregated income taxes paid, prescribes standard categories for the components of the effective tax rate reconciliation, and modifies other income tax-related disclosures. This standard is effective for fiscal years beginning after December 15, 2024, and may be applied on a retrospective or prospective basis. The Company adopted this guidance in the fiscal year 2026 on a prospective basis. The adoption did not have a material impact to the Company’s consolidated financial statements. Refer to ‘Note 13. Income Taxes’ for further details. 85 Credo Technology Group Holding Ltd Notes to Consolidated Financial Statements Recent Accounting Pronouncements Not Yet Adopted In November 2024, the FASB issued ASU 2024-03, Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures, which requires disclosure of, in interim and annual reporting periods, additional information about certain expenses in the financial statements. This standard is effective for fiscal years beginning after December 15, 2026, and interim periods beginning after December 15, 2027 and may be applied on a retrospective or prospective basis. The Company is currently evaluating the impact of adopting this guidance on its consolidated financial statements and disclosures. In July 2025, the FASB issued ASU 2025-05, Financial Instruments—Credit Losses (Topic 326) Measurement of Credit Losses for Accounts Receivable and Contract Assets, providing all entities with a practical expedient when estimating expected credit losses for current accounts receivable and current contract assets arising from transactions accounted for under Topic 606. This ASU is effective for annual reporting periods beginning after December 15, 2025. The Company is currently evaluating the impact of electing the practical expedient and the impact it may have on its consolidated financial statements and disclosures. 3. Concentrations Financial instruments that subject the Company to concentrations of credit risk consist primarily of cash and cash equivalents, short-term investments, and accounts receivable. Cash is placed in major financial institutions around the world. The Company’s cash deposits exceed insured limits. Short-term investments are subject to counterparty risk up to the amount presented on the balance sheet. Historically, a relatively small number of customers have accounted for a significant portion of the Company’s revenue. The particular customers which account for revenue concentration have varied from period to period as a result of the volumes and prices at which the customers have recently bought the Company’s products. These variations are expected to continue in the foreseeable future. The following table summarizes the significant customers’ accounts receivable and revenue as a percentage of total accounts receivable and total revenue, respectively: Accounts Receivable May 2, 2026 May 3, 2025 Customer A 53 % 86 % Customer B 20 % * Customer C 19 % * Year Ended Revenue May 2, 2026 May 3, 2025 April 27, 2024 Customer A 49 % 67 % 39 % Customer B 32 % * * Customer C * * 15 % * Less than 10% of total accounts receivable or total revenue. The Company believes that the concentration of credit risk in its trade receivables is substantially mitigated by the high level of credit worthiness of its customers and the relatively short collection terms. The Company performs ongoing credit evaluations of its customers’ financial conditions and limits the amount of credit extended when deemed necessary based upon payment history and the customer’s current credit worthiness, but generally require no collateral. The Company currently outsources all of its integrated circuit manufacturing to Taiwan Semiconductor Manufacturing Company Limited with the remaining assembly and testing processes 86 Credo Technology Group Holding Ltd Notes to Consolidated Financial Statements outsourced to other subcontractors primarily in Asia. Any disruption of or interference with the Company’s access to the goods or services from these subcontractors would impact the Company’s operations. 4. Revenue Recognition Remaining Performance Obligations Revenue allocated to remaining performance obligations represents the transaction price allocated to the performance obligations that are unsatisfied, or partially unsatisfied, which includes unearned revenue and amounts that will be invoiced and recognized as revenue in future periods. The contracted but unsatisfied performance obligation was approximately $31.9 million which the Company expects to recognize over the next fiscal year. Customer Warrant During fiscal year 2022, the Company issued a warrant to Amazon.com NV Investment Holdings LLC (Holder) to purchase an aggregate of up to 4.1 million of our ordinary shares at an exercise price of $10.74 per share (the Customer Warrant). The exercise period of the Customer Warrant is through the seventh anniversary of the issue date. The shares issuable vest in tranches over the contract term based on the amount of global payments by Holder and its affiliates to the Company, up to $201.0 million in aggregate payments. A total of 4.1 million Customer Warrant shares were vested as of May 3, 2025. As of May 2, 2026, the Holder has exercised all Customer Warrant shares, resulting in a net issuance of 3.8 million shares after 0.3 million shares withheld for exercise price. During the fiscal years ended May 3, 2025 and April 27, 2024, the Company recognized $13.2 million and $3.9 million, respectively, as contra revenue within the product sales revenue on the consolidated statements of operations. The contra revenue impact associated with the Customer Warrant has been fully amortized as of May 3, 2025. 5. Business Combination Hyperlume On September 29, 2025, the Company acquired 100% of the equity interest of Hyperlume, Inc. (Hyperlume), a developer of miniature light-emitting diode (microLED)-based optical interconnect technology for chip-to-chip communication, for a total purchase consideration of $92.0 million. Total purchase consideration is attributable to cash consideration of $88.7 million and cash settlement of vested share-based payment awards of $3.3 million by Hyperlume. This acquisition was primarily intended to expand the Company’s comprehensive portfolio of end-to-end system-level connectivity solutions with Hyperlume’s cutting-edge microLED technology to address the future of artificial intelligence-driven data infrastructure deployments. The factors contributing to the recognition of goodwill were based upon the Company’s conclusion that there are strategic and synergistic benefits that are expected to be realized from the acquisition. Goodwill recorded for the Hyperlume acquisition is not expected to be deductible for tax purposes. The Company has one reportable segment and accordingly, there is no goodwill assignment based on reporting units. The following table summarizes the total purchase consideration (in thousands): 87 Credo Technology Group Holding Ltd Notes to Consolidated Financial Statements Cash consideration $ 88,698 Cash settlement of Hyperlume share-based payment awards 3,319 Total purchase consideration 92,017 Less: Cash and cash equivalents acquired (9,453) Net cash payment for acquisition $ 82,564 IPR&D is initially capitalized at fair value as an intangible asset with an indefinite life and assessed for impairment thereafter. When an IPR&D project is completed, the IPR&D is reclassified as an amortizable intangible asset and amortized over the asset’s estimated useful life. The functional currency of the acquired business is Canadian dollars, and the assets and liabilities are translated into U.S. dollars at each fiscal quarter-end period. The differences for goodwill and intangible asset between purchase price allocation and balance sheet result from currency translation rate changes. The purchase price allocation is as follows (in thousands): Cash and other assets $ 11,084 Goodwill 69,134 Intangible asset 17,200 Deferred tax liabilities (4,558) Other current liabilities and non-current operating lease liabilities (843) $ 92,017 Comira On February 25, 2026, the Company acquired 100% of the equity interest of CoMira Solutions, Inc. (Comira), a high-speed connectivity IP innovator, for a total cash consideration of $35.1 million. This acquisition was primarily intended to bring specialized link layer, error correction and security semiconductor IP to support the development of new and advanced system-level solutions for scale-up and scale-out AI architectures. The factors contributing to the recognition of goodwill were based upon the Company’s conclusion that there are strategic and synergistic benefits that are expected to be realized from the acquisition. Goodwill recorded for the Comira acquisition is not expected to be deductible for tax purposes. The following table summarizes the total purchase consideration (in thousands): Cash consideration $ 35,073 Less: Cash and cash equivalents acquired (4,729) Net cash payment for acquisition $ 30,344 The purchase price allocation is as follows (in thousands): Cash and other assets $ 5,167 Goodwill 21,789 Intangible asset 12,000 Deferred tax liabilities (2,714) Other current liabilities and non-current operating lease liabilities (1,169) $ 35,073 Acquisition-related costs are expensed in the periods such costs are incurred and were not material for the periods presented for Hyperlume and Comira acquisitions. Pro forma results of operations for both 88 Credo Technology Group Holding Ltd Notes to Consolidated Financial Statements acquisitions have not been presented because the effect of the acquisitions was not material to the Company’s financial results. 6. Goodwill and Intangible Assets, Net Goodwill Goodwill represents the excess of the purchase price over the fair value of the net tangible and identifiable intangible assets acquired in business combinations. Goodwill is not subject to amortization but is tested for impairment annually during the fourth fiscal quarter, as well as whenever events or changes in circumstances indicate that the carrying value may not be recoverable. The Company performed the required annual goodwill impairment test as of May 2, 2026 and concluded that goodwill was not impaired. As a result of the qualitative assessments, the Company determined that it was not necessary to perform a quantitative assessment at that time. Intangible Assets, Net As of May 2, 2026, the net carrying amounts are as follows (in thousands, except for weighted-average remaining amortization period): May 2, 2026 Gross Carrying Amounts Accumulated Amortization Foreign Currency Translation Net Carrying Amounts Weighted-Average Amortization Period (Years) Developed technology $ 12,000 $ (400) $ — $ 11,600 5 IPR&D 17,200 — 462 17,662 N/A Total intangible assets $ 29,200 $ (400) $ 462 $ 29,262 Amortization for acquired intangible assets was $0.4 million during the year ended May 2, 2026 and charged to research and development expenses. The aggregate future amortization expense for acquired amortizable intangible assets as of May 2, 2026 are as follows (in thousands): Fiscal Year Amount 2027 $ 2,400 2028 2,400 2029 2,400 2030 2,400 2031 2,000 $ 11,600 7. Fair Value Measurements Fair value is an exit price representing the amount that would be received in the sale of an asset or paid to transfer a liability in an orderly transaction between market participants. As such, fair value is a market-based measurement that should be determined based on assumptions that market participants would use in pricing an asset or a liability. As a basis for considering such assumptions, the accounting guidance establishes a three-tier value hierarchy, which prioritizes the inputs used in the valuation methodologies in measuring fair value: Level 1 - Observable inputs that reflect quoted prices for identical assets or liabilities in active markets. 89 Credo Technology Group Holding Ltd Notes to Consolidated Financial Statements Level 2 - Other inputs that are directly or indirectly observable in the marketplace. Level 3 - Unobservable inputs that are supported by little or no market activity. The fair value hierarchy also requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. The Company measures the fair value of money market funds using Level 1 inputs. The Company’s certificates of deposit are classified as held to maturity securities as the Company intends to hold until their maturity dates. The certificates of deposit are valued using Level 2 inputs. Pricing sources may include industry standard data providers, security master files from large financial institutions, and other third-party sources used to determine a daily market value. The following tables present the fair value of the financial instruments measured on a recurring basis, or measured at amortized cost which approximates fair value, as of May 2, 2026 and May 3, 2025 (in thousands). May 2, 2026 Level 1 Level 2 Level 3 Total Cash equivalents: Money market funds $ 1,073,486 $ — $ — $ 1,073,486 Certificates of deposit — 77,864 — 77,864 Short-term investments: Certificates of deposit — 278,334 — 278,334 Total cash equivalents and short-term investments $ 1,073,486 $ 356,198 $ — $ 1,429,684 May 3, 2025 Level 1 Level 2 Level 3 Total Cash equivalents: Money market funds $ 148,036 $ — $ — $ 148,036 Certificates of deposit — 65,137 — 65,137 Short-term investments: Certificates of deposit — 195,010 — 195,010 Total cash equivalents and short-term investments $ 148,036 $ 260,147 $ — $ 408,183 The carrying amount of the Company’s financial instruments, including cash equivalents, short-term investments, accounts receivable and accounts payable, approximate their respective fair values because of their short maturities. As of May 2, 2026 and May 3, 2025, there were no unrealized loss or gains associated with the Company’s financial instruments. The interest income recognized during the years ended May 2, 2026, May 3, 2025 and April 27, 2024 was $31.3 million, $18.8 million and $15.3 million, respectively. 90 Credo Technology Group Holding Ltd Notes to Consolidated Financial Statements 8. Supplemental Financial Information Inventories Inventories consisted of the following (in thousands): May 2, 2026 May 3, 2025 Raw materials $ 64,357 $ 12,734 Work in process 34,296 24,583 Finished goods 152,178 52,712 $ 250,831 $ 90,029 Property and Equipment, Net Property and equipment consisted of the following (in thousands): May 2, 2026 May 3, 2025 Production equipment $ 63,214 $ 44,789 Computer equipment and software 48,924 27,901 Laboratory equipment 36,933 21,944 Leasehold improvements 4,096 3,513 Construction in progress 27,027 9,687 180,194 107,834 Less: accumulated depreciation and amortization (78,589) (44,203) $ 101,605 $ 63,631 Depreciation and amortization expense, excluding the asset impairment charges, for the years ended May 2, 2026, May 3, 2025 and April 27, 2024, was $34.6 million, $21.9 million, and $13.8 million, respectively. Construction in progress and production equipment primarily includes mask set costs capitalized relating to the Company’s products. Other Current Liabilities Accrued expenses and other current liabilities consisted of the following (in thousands): May 2, 2026 May 3, 2025 Accruals relating to inventory purchases $ 7,193 $ 10,164 Current payables relating to purchases of property and equipment 12,179 8,420 Current portion of operating lease liabilities 4,831 3,342 Other 43,917 13,530 $ 68,120 $ 35,456 9. Commitments and Contingencies Non-Cancelable Purchase Obligations Total future non-cancelable purchase obligations as of May 2, 2026 were as follows (in thousands): 91 Credo Technology Group Holding Ltd Notes to Consolidated Financial Statements Fiscal Year Purchase Commitments to Manufacturing Vendors and Foundry Partners Technology License Fees Total 2027 $ 333,503 $ 12,555 $ 346,058 2028 4,243 6,803 11,046 2029 — 2,850 2,850 Total unconditional purchase commitments $ 337,746 $ 22,208 $ 359,954 Technology license fees include the liabilities under agreements for technology licenses between the Company and various vendors. Under the Company’s manufacturing relationships with its foundry partners, cancellation of outstanding purchase orders is allowed but requires payment of all costs and expenses incurred through the date of cancellation. As of May 2, 2026, the total value of non-cancelable inventory purchase orders payable within the next one year that were committed with the Company’s foundry partners and third-party subcontractors was approximately $149.2 million. Such purchase commitments are included in the preceding table. The Company has three manufacturing supply capacity reservation agreements with assembly subcontractors as of May 2, 2026. Under these arrangement, the Company has paid refundable deposits to the supplier in exchange for reserved manufacturing production capacity over the remaining term of the agreements, which range from two to five years. In addition, the Company committed to certain purchase levels that were in line with the capacity reserved. If the Company does not meet the purchase level commitment, the agreement requires the Company to pay a fee equal to the difference between the actual purchase and the purchase commitment, up to the value of refundable deposits made. The Company currently estimates that it has made purchase level commitments of at least $188.6 million for the fiscal year 2027 through fiscal year 2028 under the capacity reservation agreement. Such purchase commitments are included in the preceding table. In addition, the Company had refundable deposits of $71.0 million as of May 2, 2026, of which $39.8 million was recorded in other current assets and $31.2 million was recorded in other non-current assets on the consolidated balance sheets. Subsequent to May 2, 2026, the Company entered into a manufacturing supply capacity reservation agreement with an assembly subcontractor and will pay $13.1 million of refundable deposits. The total inventory purchase within the next two years that was committed with the subcontractor was approximately $43.7 million. Warranty Obligations The Company has contractual commitments to various customers, which could require the Company to incur costs to repair an epidemic defect with respect to its products outside of the normal warranty period if such defect were to occur. The Company’s products generally carry a standard one-year warranty. The Company’s warranty expense has not been material in the periods presented. Indemnifications In the ordinary course of business, the Company may provide indemnifications of varying scope and terms to customers, vendors, lessors, investors, directors, officers, employees and other parties with respect to certain matters, including, but not limited to, losses arising out of the Company’s breach of such agreements, services to be provided by the Company or from intellectual property infringement claims made by third parties. These indemnifications may survive termination of the underlying agreement and the maximum potential amount of future payments the Company could be required to make under these indemnification provisions may not be subject to maximum loss clauses. The Company has not incurred material costs to defend lawsuits or settle claims related to these indemnifications. Accordingly, the Company has no liabilities recorded for these agreements as of May 2, 2026 and May 3, 2025. 92 Credo Technology Group Holding Ltd Notes to Consolidated Financial Statements Legal Proceedings From time to time, the Company may be a party to various litigation claims in the normal course of business. Legal fees and other costs associated with such actions are expensed as incurred. The Company assesses, in conjunction with legal counsel, the need to record a liability for litigation and contingencies. Accrual estimates are recorded when and if it is determined that such a liability for litigation and contingencies are both probable and reasonably estimable. As of the date of issuance of the consolidated financial statements, the Company was not subject to any litigation. Accruals for loss contingencies or recognition of actual losses were not material in any of the periods presented. 10. Ordinary Shares The Company filed the Amended and Restated Memorandum of Association with Cayman Islands, which authorized 1 billion ordinary shares, par value $0.00005 per share and 50 million preferred shares. Each ordinary share is entitled to one vote per share. The holders of ordinary shares are also entitled to receive dividends whenever funds are legally available and when declared by the Company’s board of directors, subject to the prior rights of holders of all other classes of shares outstanding. 11. Share Incentive Plan 2015 Stock Plan The Company adopted the 2015 Stock Plan (the 2015 Plan) in February 2015. The 2015 Plan was an equity incentive program under which employees of the Company or its subsidiary corporations (including officers), non-employee members of the Company’s board of directors, and consultants to the Company or its subsidiary corporations were offered an opportunity to acquire the Company’s ordinary shares. The 2015 Plan provided both for the direct award or sale of ordinary shares (RSAs) and for the grant of options to purchase ordinary shares. Options granted under the 2015 Plan were Incentive Stock Options (ISOs) intended to qualify under Title 26 U.S. Code Section 422 or Non-qualified Stock Options (NSOs) which were not intended to so qualify. Only employees, outside directors and consultants of either the Company or a subsidiary of the Company, were eligible for the grant of NSO or the direct award or sale of ordinary shares. Only employees of either the Company or of a subsidiary of the Company, were eligible for the grant of ISOs. As of January 27, 2022, the 2015 Plan has ceased to be available for grants of new awards. Both RSAs and options granted generally vest over four years and vest at a rate of 25% upon the first anniversary of the issuance date and 1/48th per month thereafter. 93 Credo Technology Group Holding Ltd Notes to Consolidated Financial Statements A summary of information related to share option activity, excluding options early exercised, is as follows: Outstanding Share Options (in millions) Weighted-Average Exercise Price Weighted-Average Remaining Contractual Term Aggregate Intrinsic Value (in millions) Balances as of April 29, 2023 8.9 $ 2.02 6.22 $ 0.1 Options exercised and vested (2.3) $ 1.98 Options canceled/ forfeited (0.2) $ 4.64 Balances as of April 27, 2024 6.4 $ 1.97 5.30 $ 106.5 Options exercised and vested (2.9) $ 1.64 Options canceled/ forfeited — $ 4.58 Balances as of May 3, 2025 3.5 $ 2.23 4.79 $ 162.8 Options exercised and vested (1.4) $ 2.23 Options canceled/ forfeited — $ 2.33 Balances as of May 2, 2026 2.1 $ 2.24 3.96 $ 383.4 Vested or expected to vest as of May 2, 2026 2.1 $ 2.24 3.96 $ 383.4 Exercisable as of May 2, 2026 2.1 $ 2.24 3.96 $ 383.4 During the years ended May 2, 2026, May 3, 2025 and April 27, 2024, the total intrinsic value of options exercised was $162.9 million, $130.5 million and $36.2 million, respectively. The weighted-average grant date fair value of options vested was $1.78, $1.64 and $1.52 per share for the years ended May 2, 2026, May 3, 2025 and April 27, 2024, respectively. The total grant date fair value of share options that vested was $6.3 million, $6.8 million and $13.3 million as of May 2, 2026, May 3, 2025 and April 27, 2024, respectively. As of May 2, 2026, there was no unrecognized compensation cost related to share options. 2021 Long-Term Incentive Plan In December 2021, the Company adopted the 2021 long-term incentive plan (the 2021 Plan). Upon the adoption, the 2021 Plan had 19.9 million ordinary shares reserved for issuance and additional 35.4 million ordinary shares reserved thereafter. Awards granted under the 2021 Plan may include, but are not limited to, options, time-based restricted share units (RSUs) and performance-based restricted share units (PSUs). RSU and PSU awards are denominated in ordinary shares, but may be settled in cash or shares upon vesting, as determined by the Company at the time of grant. None of the awards granted under the 2021 Plan as of May 2, 2026 allowed cash settlement. RSU awards under the 2021 Plan generally vest over 4 years. As of May 2, 2026, 34.8 million shares remained available for future issuance under the 2021 Plan. 94 Credo Technology Group Holding Ltd Notes to Consolidated Financial Statements A summary of RSU activity is as follows: Number of shares (in millions) Weighted-Average Grant Date Fair Value Weighted-Average Remaining Contractual Term Aggregate Intrinsic Value (in millions) Balances as of Balance as of April 29, 2023 7.8 $ 11.66 1.65 $ 63.2 Granted 5.4 $ 20.08 Vested (2.6) $ 11.98 Canceled/ forfeited (0.4) $ 11.49 Balances as of Balances as of April 27, 2024 10.1 $ 16.11 1.52 $ 188.2 Granted 3.9 $ 59.10 Vested (4.0) $ 15.53 Canceled/ forfeited (0.6) $ 20.05 Balances as of Balances as of May 3, 2025 9.5 $ 33.88 1.39 $ 458.1 Granted 2.2 $ 112.72 Vested (4.2) $ 29.64 Canceled/ forfeited (0.3) $ 32.40 Balances as of Balances and expected to vest as of May 2, 2026 7.2 $ 58.43 1.18 $ 1,319.6 As of May 2, 2026, unamortized compensation expense related to RSUs was $367.9 million. The unamortized compensation expense for RSUs will be amortized on a straight-line basis and is expected to be recognized over a weighted-average period of 2.28 years. A summary of PSU activity is as follows: Number of shares (in millions) Weighted-Average Grant Date Fair Value Weighted-Average Remaining Contractual Term Aggregate Intrinsic Value (in millions) Balances as of April 27, 2024 — $ — 0.00 $ — Granted 0.2 $ 43.70 Balances as of May 3, 2025 0.2 $ 43.70 2.53 $ 10.1 Granted 1.3 $ 92.57 Balances as of Balances and expected to vest as of May 2, 2026 1.5 $ 85.33 2.15 $ 272.1 During fiscal year 2025, the Company granted 0.2 million PSUs to certain named executive officers which will be eligible to become earned between 0% and 200% of target levels based on the Company’s achievement of specified revenue goals for the fiscal year ended May 2, 2026. The PSUs became earned at 200% of target levels based on the Company’s achievement of specified revenue goals and will be vested subsequent to May 2, 2026. During fiscal year 2026, the Company granted 1.3 million PSUs to certain named executive officers and employees which will be eligible to become fully earned or unearned at 100% of target levels based on the Company’s achievement of stock price, product qualification and specified revenue goals. The Compensation Committee will measure the achievement of such goals and determine the number of refresh PSUs that have become earned based on performance. The PSUs will then be subject to a service-based vesting requirement over an additional three to four-year period. 95 Credo Technology Group Holding Ltd Notes to Consolidated Financial Statements As of May 2, 2026, unamortized compensation expense related to PSUs was $37.0 million. The unamortized compensation expense for PSUs will be amortized on a straight-line basis and is expected to be recognized over a weighted-average period of 2.15 years. Employee Stock Purchase Plan In January 2022, the Company adopted the Employee Stock Purchase Plan (ESPP). Under the ESPP, a total of 3.8 million shares have been authorized for the grant of shares and participants can purchase the Company’s ordinary shares using payroll deductions, which may not exceed 15% of their total cash compensation. Pursuant to the terms of the ESPP, the “look-back” period for the share purchase price is 24 months. Offering and purchase periods begin on January 1 and July 1 of each year. Participants will be granted the right to purchase ordinary shares at a price per share that is 85% of the lesser of the fair market value of the shares at (i) the participant’s entry date into the two-year offering period or (ii) the end of each six-month purchase period within the offering period. During the years ended May 2, 2026, May 3, 2025 and April 27, 2024, 0.2 million, 0.2 million and 0.3 million shares were issued under the ESPP, respectively. As of May 2, 2026, 7.5 million shares remained available for future issuance under the ESPP. The following weighted-average assumptions to calculate the fair value of ordinary shares to be issued under the ESPP on the date of grant using the Black-Scholes option pricing model in the periods presented: Year Ended May 2, 2026 May 3, 2025 April 27, 2024 Grant date fair value $27.64 $10.51 $6.04 Expected volatility 78.62% 74.99% 56.13% Expected term (in years) 1.27 1.18 1.33 Risk-free interest rate 4.29% 4.74% 3.40% Expected dividend yield —% —% —% Summary of Share-based Compensation Expense The following table summarizes share-based compensation cost included in the consolidated statements of operations (in thousands). Year Ended May 2, 2026 May 3, 2025 April 27, 2024 Cost of revenue $ 1,416 $ 1,194 $ 1,131 Research and development 102,576 41,930 21,359 Selling, general and administrative 78,646 34,231 16,532 $ 182,638 $ 77,355 $ 39,022 In connection with the Hyperlume acquisition, the Company issued 87 thousand RSUs under its 2021 long-term incentive plan in replacement for the unvested options under Hyperlume’s equity incentive plan. The RSUs retain the same vesting conditions as the unvested options that they replaced. The Company also issued 132 thousand restricted shares of the Company to one of the founders of Hyperlume and 132 thousand restricted shares of a newly formed subsidiary of the Company that are exchangeable into restricted shares of the Company to the other founder of Hyperlume. The restricted shares were issued in exchange for the founders’ outstanding equity interests in Hyperlume and vest on a quarterly basis, subject to continued employment with the Company over the next 4 years. Both RSUs and restricted shares were measured at the acquisition date’s fair value of $146.01 per share and the fair value of those shares represent post-acquisition share-based compensation expense 96 Credo Technology Group Holding Ltd Notes to Consolidated Financial Statements that will be recognized as these employees provide service over the remaining vesting periods of up to 4 years. 12. Leases The Company's leases include office space located in the United States and other international locations, which are all classified as operating leases. The Company’s leases have remaining lease terms generally between 1 year and 7 years. Operating leases are included in right of use assets, other current liabilities, and non-current operating lease liabilities on the Company’s consolidated balance sheets. The Company does not have any finance leases. Lease expense and supplemental cash flow information are as follows (in thousands): Year Ended May 2, 2026 May 3, 2025 Operating lease expenses $ 5,077 $ 4,186 Cash paid for amounts included in the measurement of operating lease liabilities $ 4,716 $ 3,961 Right-of-use assets obtained in exchange for lease obligation $ 12,787 $ 5,178 The aggregate future lease payments for operating leases as of May 2, 2026 are as follows (in thousands): Fiscal Year Operating leases 2027 $ 6,092 2028 6,377 2029 5,843 2030 4,971 2031 3,014 Thereafter 3,364 Total lease payments 29,661 Less: Interest (4,212) Present value of lease liabilities $ 25,449 As of May 2, 2026, the weighted average remaining lease term for the Company's operating leases was 5.11 years and the weighted average discount rate used to determine the present value of the Company's operating leases was approximately 6.27%. In December 2025, the Company entered into multiple leasing agreements for additional office spaces to expand the corporate headquarter buildings in the United States. The lease that has not yet commenced has an initial lease term of 6 years and an annual base rent of approximately $1.5 million. The lease arrangements further extend headquarter office spaces through calendar year 2036. 97 Credo Technology Group Holding Ltd Notes to Consolidated Financial Statements 13. Income Taxes Income (loss) before provision (benefit) for income taxes consists of the following (in thousands): 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