# EDGAR Filing Document

**Accession Number:** 0001807794
**File Stem:** 0001628280-23-005837
**Filing Date:** 2023-3
**Character Count:** 26370
**Document Hash:** 13c26628a87c829333a1d6eae576416e
**Contains OCR:** False
**Source Format:** 

## Filing Content

## Filing Summary
**0001628280-23-005837.hdr.sgml**: 20230301

**ACCESSION NUMBER**: 0001628280-23-005837

**CONFORMED SUBMISSION TYPE**: 8-K

**PUBLIC DOCUMENT COUNT**: 13

**CONFORMED PERIOD OF REPORT**: 20230301

**ITEM INFORMATION**: Results of Operations and Financial Condition

**ITEM INFORMATION**: Financial Statements and Exhibits

**FILED AS OF DATE**: 20230301

**DATE AS OF CHANGE**: 20230301

**FILER**: 

**COMPANY DATA:**
- **COMPANY CONFORMED NAME:** Credo Technology Group Holding Ltd
- **CENTRAL INDEX KEY:** 0001807794
- **STANDARD INDUSTRIAL CLASSIFICATION:** SEMICONDUCTORS & RELATED DEVICES [3674]
- **IRS NUMBER:** 000000000
- **STATE OF INCORPORATION:** E9
- **FISCAL YEAR END:** 0429

**FILING VALUES:**
- **FORM TYPE:** 8-K
- **SEC ACT:** 1934 Act
- **SEC FILE NUMBER:** 001-41249
- **FILM NUMBER:** 23693675

**BUSINESS ADDRESS:**
- **STREET 1:** C/O MAPLES CORPORATE SERVICES, LIMITED
- **STREET 2:** PO BOX 309, UGLAND HOUSE
- **CITY:** GRAND CAYMAN
- **STATE:** E9
- **ZIP:** KY1-1104
- **BUSINESS PHONE:** (408) 664-9329

**MAIL ADDRESS:**
- **STREET 1:** C/O MAPLES CORPORATE SERVICES, LIMITED
- **STREET 2:** PO BOX 309, UGLAND HOUSE
- **CITY:** GRAND CAYMAN
- **STATE:** E9
- **ZIP:** KY1-1104

?xml version="1.0" ? crdo-20230301

**UNITED STATES**

**SECURITIES AND EXCHANGE COMMISSION**

**Washington, D.C. 20549**

_________________________

**FORM 8-K** 

_________________________

**CURRENT REPORT**

**Pursuant to Section 13 or 15(d) of the**

**Securities Exchange Act of 1934**

**Date of Report (Date of earliest event reported): March 1, 2023**

_________________________

**Credo Technology Group Holding Ltd**

**(Exact name of registrant as specified in its charter)**

_________________________

---

| | | | |
|:---|:---|:---|:---|
| **Cayman Islands** | **001-41249** | **001-41249** | **N/A** |
| **(State or other jurisdiction <br>of incorporation)** | **(Commission <br>File Number)** | **(Commission <br>File Number)** | **(IRS Employer <br>Identification No.)** |
| **c/o Maples Corporate Services, Limited,**<br>**PO Box 309, Ugland House**<br>**Grand Cayman, KY1-1104, Cayman Islands** | **c/o Maples Corporate Services, Limited,**<br>**PO Box 309, Ugland House**<br>**Grand Cayman, KY1-1104, Cayman Islands** | **N/A** | **N/A** |
| **(Address of principal executive offices)** | **(Address of principal executive offices)** | **(Zip Code)** | **(Zip Code)** |

---

**Registrant's telephone number, including area code: (408) 664-9329**

**N/A**

**(Former name or former address, if changed since last report)**

_________________________

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

☐ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

☐ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

☐ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

☐ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Securities registered pursuant to Section 12(b) of the Act:

---

| | | |
|:---|:---|:---|
| **Title of each class** | **Trading**<br>**Symbol(s)** | **Name of each exchange**<br>**on which registered** |
| **Ordinary shares, par value $0.00005 per share** | **CRDO** | **The Nasdaq Stock Market LLC** |

---

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Emerging growth company ☒

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

------

**Item 2.02&nbsp;&nbsp;&nbsp;&nbsp;Results of Operations and Financial Condition.**

On March 1, 2023, Credo Technology Group Holding Ltd (the "Company") issued a press release announcing its financial results for the fiscal quarter ended January 28, 2023. A copy of the press release is furnished herewith as Exhibit 99.1.

The information in Item 2.02 of this current report on Form 8-K, including the accompanying Exhibit 99.1, shall not be deemed "filed" for the purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the "Exchange Act"), or otherwise subject to the liabilities of that section, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended, or the Exchange Act, regardless of any general incorporation language in such filing.

**Item 9.01&nbsp;&nbsp;&nbsp;&nbsp;Financial Statements and Exhibits.**

**&nbsp;&nbsp;&nbsp;&nbsp;**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) Exhibits.

---

| | |
|:---|:---|
| **Exhibit Number** | **Description of Exhibit** |
| 99.1 | <u>[Press Release dated March 1, 2023](credoq32023ex-991.htm)</u> |
| 104 | Cover Page Interactive Data File (the cover page XBRL tags are embedded within the Inline XBRL document) |

---

------

**SIGNATURE**

Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

---

| | | |
|:---|:---|:---|
| | **Credo Technology Group Holding Ltd** | **Credo Technology Group Holding Ltd** |
| Date: March 1, 2023 | By: | **/s/ Daniel Fleming** |
|  |  | Daniel Fleming |
|  |  | Chief Financial Officer |

---

## Exhibit 99.1

**Exhibit 99.1** 

**Credo Technology Group Holding Ltd Reports Third Quarter of Fiscal Year 2023** 

**Financial Results** 

**San Jose, Calif. (March 1, 2023)** - Credo Technology Group Holding Ltd (NASDAQ: CRDO), an innovator in providing secure, high-speed connectivity solutions that deliver improved power and cost efficiency as data rates and corresponding bandwidth requirements increase throughout the data infrastructure market, today reported financial results for the third quarter of fiscal year 2023, ended January 28, 2023.

**Third Quarter of Fiscal Year 2023 Financial Highlights**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**•** Revenue of $54.3 million, grew by 6% quarter over quarter

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• GAAP gross margin of 58.9% and non-GAAP gross margin of 59.3%

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• GAAP operating expenses of $34.9 million and non-GAAP operating expenses of $25.7 million

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• GAAP net income of $2.8 million and non-GAAP net income of $7.5 million

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• GAAP diluted net income per share of $0.02 and non-GAAP diluted net income per share of $0.05

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Ending cash and short-term investment balance of $233.0 million

**Management Commentary**

Bill Brennan, Credo's President and Chief Executive Officer, stated, "In the fiscal quarter ended January 28, 2023, Credo achieved revenue of $54.3 million, an increase of 71% year over year and 6% compared to the prior quarter. Going forward, Credo is focused on the large market opportunity afforded us by our differentiated solutions. We remain committed to close customer collaboration, continued innovation, and expansion of our solution portfolio to address the ever-increasing needs for higher bandwidth and more power efficient connectivity solutions."

**Fourth Quarter of Fiscal 2023 Financial Outlook** 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Revenue is expected to be between $30.0 million and $32.0 million

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• GAAP gross margin is expected to be between 55.8%-57.8% and non-GAAP gross margin is expected to be between 56.0%-58.0%

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• GAAP operating expenses are expected to be between $32.8 million and $34.8 million; and non-GAAP operating expenses are expected to be between $26.0 million and $28.0 million

------

**Conference Call** 

Credo will conduct a conference call on Wednesday, March 1, 2023, at 2:00 p.m. Pacific Time to discuss its financial results for the third quarter of fiscal year 2023, ended January 28, 2023. Interested parties may join the conference call by registering online at https://register.vevent.com/register/BI31a81424c15248d480b63743ff62bf5e. After registering, a confirmation will be sent through email, including dial-in details and unique conference call codes for entry. It is recommended that participants register and dial in for the call at least 10 minutes before the start of the call. A live webcast of the conference call will be available on Credo's Investor Relations website at http://investors.credosemi.com/. A replay of the webcast will be available via the web at http://investors.credosemi.com/.

**Discussion of Non-GAAP Financial Measures** 

This press release contains references to the non-GAAP financial measures of non-GAAP gross profit, non-GAAP gross margin, non-GAAP operating expenses, non-GAAP operating income (loss), non-GAAP operating income (loss) margin, non-GAAP net income (loss) and non-GAAP diluted net income (loss) per share. Reconciliation of these non-GAAP measures to their comparable GAAP measures is included below. This non-GAAP information should not be construed as an alternative to the reported results determined in accordance with GAAP.

Non-GAAP financial measures exclude the effect of share-based compensation expenses, warrant contra revenue, asset impairment and related charges (if applicable), and the related tax effect adjustment to the provision for income taxes.

Credo uses a full-year non-GAAP tax rate to compute the non-GAAP tax provision. This full-year non-GAAP tax rate is based on Credo's annual GAAP income, adjusted to exclude non-GAAP items, as well as the effects of significant non-recurring and period specific tax items which vary in size and frequency. Credo's non-GAAP tax rate is determined on an annual basis and may be adjusted during the year to take into account events that may materially affect the non-GAAP tax rate such as tax law changes, significant changes in Credo's geographic mix of revenue and expenses, or changes to Credo's corporate structure.

GAAP diluted net income (loss) per share is calculated using basic weighted average shares outstanding when there is a GAAP net loss, and calculated using diluted weighted average shares outstanding when there is a GAAP net income. Non-GAAP diluted net income per share is calculated using non-GAAP diluted weighted average shares outstanding. Non-GAAP adjustment for the number of shares used in the diluted per share calculations excludes the impact of share-based compensation expense expected to be incurred in future periods and not yet recognized in the financial statements, which would otherwise be assumed to be used to repurchase shares under the GAAP treasury stock method.

Credo believes that the presentation of non-GAAP financial measures provides important supplemental information to management and investors regarding financial and business trends relating to Credo's financial condition and results of operations. While Credo uses non-GAAP financial measures as a tool to enhance its understanding of certain aspects of its financial performance, Credo does not consider these measures to be a substitute for, or superior to, financial measures calculated in accordance with GAAP. Consistent with this approach, Credo believes that disclosing non-GAAP financial measures to the readers of its financial statements provides such readers with useful supplemental data that, while not a substitute for GAAP financial measures, allows for greater transparency in the review of its financial and operational performance.

Externally, management believes that investors may find Credo's non-GAAP financial measures useful in their assessment of Credo's operating performance and the valuation of Credo. Internally, Credo's non-GAAP financial measures are used in the following areas:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Management's evaluation of Credo's operating performance;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Management's establishment of internal operating budgets; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Management's performance comparisons with internal forecasts and targeted business models.

Non-GAAP financial measures have limitations in that they do not reflect all of the costs associated with the operations of Credo's business as determined in accordance with GAAP. As a result, you should not consider these measures in isolation or as a substitute for analysis of Credo's results as reported under GAAP. The exclusion of the above items from our GAAP financial metrics does not necessarily mean that these costs are unusual or infrequent.

------

**Forward-Looking Statements under the Private Securities Litigation Reform Act of 1995**

<br>This press release contains forward-looking statements within the meaning of the federal securities laws that involve risks and uncertainties. All statements other than statements of historical fact could be deemed forward-looking statements, including, but not limited to any statements regarding: launches of new or expansion of existing products or services, technology developments and innovation; our plans, strategies or objectives with respect to future operations; future financial results; expectations regarding the markets and industries in which Credo conducts business; and assumptions underlying any of the foregoing. Words such as "anticipates," "expects," "intends," "plans," "projects," "believes," "seeks," "estimates," "can," "may," "will," "would," "outlook," "forecast," "targets" and similar expressions may identify such forward-looking statements. These statements are not guarantees of results and should not be considered as an indication of future activity or future performance. Forward-looking statements are predictions, projections and other statements about future events that are based on current expectations and assumptions and, as a result, are subject to risks and uncertainties. Actual events or results may differ materially from those described in this press release due to a number of risks and uncertainties. Readers are encouraged to review risk factors and all other disclosures appearing in the Company's Annual Report on Form 10-K as filed with the Securities and Exchange Commission (SEC) on June 8, 2022, as well as Credo's other filings with the SEC, for further information on risks and uncertainties that could affect Credo's business, financial condition and results of operation. Copies of these filings are available from the SEC, the Company's website or the Company's investor relations department. Forward-looking statements speak only as of the date they are made. Credo assumes no obligation to update or revise any forward-looking statements as a result of new information, future events or otherwise, except as required by law. Readers are cautioned not to place undue reliance on these forward-looking statements that speak only as of the date herein.

------

**About Credo** 

Our mission is to deliver high-speed solutions to break bandwidth barriers on every wired connection in the data infrastructure market. Credo is an innovator in providing secure, high-speed connectivity solutions that deliver improved power and cost efficiency as data rates and corresponding bandwidth requirements increase exponentially throughout the data infrastructure market. Our innovations ease system bandwidth bottlenecks while simultaneously improving on power, security and reliability. Our connectivity solutions are optimized for optical and electrical Ethernet applications, including the emerging 100G (or Gigabits per second), 200G, 400G and 800G port markets. Our products are based on our proprietary Serializer/Deserializer (SerDes) and Digital Signal Processor (DSP) technologies. Our product families include integrated circuits (ICs), Active Electrical Cables (AECs) and SerDes Chiplets. Our intellectual property (IP) solutions consist primarily of SerDes IP licensing.

**Investor Relations Contact:**

Dan O'Neil

IR@credosemi.com

------

**Credo Technology Group Holding Ltd** 

**Condensed Consolidated Statements of Operations (Unaudited)** 

**(In thousands, except per share amounts)** 

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
| | **Three Months Ended** | **Three Months Ended** | **Three Months Ended** | **Nine Months Ended** | **Nine Months Ended** |
| | **January 28, 2023** | **October 29, 2022** | **January 31, 2022** | **January 28, 2023** | **January 31, 2022** |
| Revenue: |  |  |  |  |  |
| &nbsp;&nbsp;Product sales | $38033 | $44349 | $22706 | $117645 | $48423 |
| &nbsp;&nbsp;Product engineering services | 3635 | 3750 | 3954 | 8209 | 6628 |
| &nbsp;&nbsp;IP license | 11715 | 2084 | 5022 | 24179 | 12194 |
| &nbsp;&nbsp;IP license engineering services | 887 | 1186 | 118 | 2073 | 1706 |
| &nbsp;&nbsp;&nbsp;&nbsp;Total revenue | 54270 | 51369 | 31800 | 152106 | 68951 |
| Cost of revenue: |  |  |  |  |  |
| &nbsp;&nbsp;Cost of product sales revenue | 21833 | 22658 | 12230 | 62016 | 26436 |
| &nbsp;&nbsp;Cost of product engineering services revenue | 228 | 418 | 410 | 746 | 1807 |
| &nbsp;&nbsp;Cost of IP license revenue |  |  |  | 1179 |  |
| &nbsp;&nbsp;Cost of IP license engineering services revenue | 222 | 334 | 48 | 556 | 462 |
| &nbsp;&nbsp;&nbsp;&nbsp;Total cost of revenue | 22283 | 23410 | 12688 | 64497 | 28705 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Gross profit | 31987 | 27959 | 19112 | 87609 | 40246 |
| Operating expenses: |  |  |  |  |  |
| &nbsp;&nbsp;Research and development | 20530 | 18158 | 10995 | 55371 | 32488 |
| &nbsp;&nbsp;Selling, general and administrative | 11936 | 11540 | 8568 | 34674 | 23393 |
| &nbsp;&nbsp;Impairment charges | 2407 |  |  | 2407 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Total operating expenses | 34873 | 29698 | 19563 | 92452 | 55881 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Operating loss | (2886) | (1739) | (451) | (4843) | (15635) |
| Other income (expense), net | 2530 | (692) | (80) | 1618 | (70) |
| &nbsp;&nbsp;Loss before income taxes | (356) | (2431) | (531) | (3225) | (15705) |
| Provision (benefit) for income taxes | (3179) | 929 | (387) | (2615) | 1116 |
| &nbsp;&nbsp;Net income (loss) | $2823 | $(3360) | $(144) | $(610) | $(16821) |
| Net income (loss) per share: |  |  |  |  |  |
| &nbsp;&nbsp;Basic | $0.02 | $(0.02) | $— | $— | $(0.24) |
| &nbsp;&nbsp;Diluted | $0.02 | $(0.02) | $— | $— | $(0.24) |
| Weighted-average shares used in computing net income (loss) per share: |  |  |  |  |  |
| &nbsp;&nbsp;Basic | 146908 | 146012 | 73815 | 146000 | 70439 |
| &nbsp;&nbsp;Diluted | 156519 | 146012 | 73815 | 146000 | 70439 |

---

------

**Credo Technology Group Holding Ltd** 

**Condensed Consolidated Balance Sheets (Unaudited)** 

**(In thousands)**

---

| | | |
|:---|:---|:---|
| | **January 28, 2023** | **April 30, 2022** |
| **Assets** | **Assets** | **Assets** |
| Current Assets: |  |  |
| &nbsp;&nbsp;Cash and cash equivalents | $123783 | $259322 |
| &nbsp;&nbsp;Short-term investments | 109228 |  |
| &nbsp;&nbsp;Accounts receivable | 43168 | 29524 |
| &nbsp;&nbsp;Inventories | 50315 | 27337 |
| &nbsp;&nbsp;Contract assets | 19245 | 10071 |
| &nbsp;&nbsp;Prepaid expenses and other current assets | 4282 | 5923 |
| &nbsp;&nbsp;&nbsp;&nbsp;Total current assets | 350021 | 332177 |
| Property and equipment, net | 39087 | 21844 |
| Right of use assets | 15552 | 16954 |
| Other non-current assets | 12591 | 4714 |
| &nbsp;&nbsp;Total assets | $417251 | $375689 |
| **Liabilities and Shareholders' Equity** | **Liabilities and Shareholders' Equity** | **Liabilities and Shareholders' Equity** |
| Current Liabilities: |  |  |
| &nbsp;&nbsp;Accounts payable | $21335 | $8487 |
| &nbsp;&nbsp;Accrued compensation and benefits | 3369 | 4713 |
| &nbsp;&nbsp;Accrued expenses and other current liabilities | 15141 | 12063 |
| &nbsp;&nbsp;Deferred revenue | 3537 | 1234 |
| &nbsp;&nbsp;&nbsp;&nbsp;Total current liabilities | 43382 | 26497 |
| Non-current operating lease liabilities | 13514 | 14809 |
| Other non-current liabilities | 5802 | 220 |
| &nbsp;&nbsp;Total liabilities | 62698 | 41526 |
| Shareholders' equity: |  |  |
| &nbsp;&nbsp;Ordinary shares | 7 | 7 |
| &nbsp;&nbsp;Additional paid in capital | 445654 | 424562 |
| &nbsp;&nbsp;Accumulated other comprehensive income (loss) | (69) | 23 |
| &nbsp;&nbsp;Accumulated deficit | (91039) | (90429) |
| &nbsp;&nbsp;&nbsp;&nbsp;Total shareholders' equity | 354553 | 334163 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total liabilities and shareholders' equity | $417251 | $375689 |

---

------

**Credo Technology Group Holding Ltd** 

**Reconciliations from GAAP to Non-GAAP (Unaudited)** 

**(In thousands, except percentages and per share amounts)** 

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
| | **Three Months Ended** | **Three Months Ended** | **Three Months Ended** | **Nine Months Ended** | **Nine Months Ended** |
| | **January 28, 2023** | **October 29, 2022** | **January 31, 2022** | **January 28, 2023** | **January 31, 2022** |
| &nbsp;&nbsp;&nbsp;&nbsp;GAAP gross profit | $31987 | $27959 | $19112 | $87609 | $40246 |
| &nbsp;&nbsp;&nbsp;&nbsp;Reconciling items: |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Warrant contra revenue | 260 | 247 | 407 | 895 | 407 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Share-based compensation | 98 | 149 | 46 | 551 | 180 |
| &nbsp;&nbsp;&nbsp;&nbsp;Total reconciling items: | 358 | 396 | 453 | 1446 | 587 |
| &nbsp;&nbsp;&nbsp;&nbsp;Non-GAAP gross profit (A) | $32345 | $28355 | $19565 | $89055 | $40833 |
| &nbsp;&nbsp;&nbsp;&nbsp;GAAP gross margin | 58.9% | 54.4% | 60.1% | 57.6% | 58.4% |
| &nbsp;&nbsp;&nbsp;&nbsp;Non-GAAP gross margin | 59.3% | 54.9% | 60.7% | 58.2% | 58.9% |
| &nbsp;&nbsp;&nbsp;&nbsp;Total GAAP operating expenses | $34873 | $29698 | $19563 | $92452 | $55881 |
| &nbsp;&nbsp;&nbsp;&nbsp;Reconciling item: |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Share-based compensation | (5071) | (4742) | (1392) | (15055) | (3640) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Impairment and related charges | (4151) |  |  | (4151) |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Total reconciling items: | (9222) | (4742) | (1392) | (19206) | (3640) |
| &nbsp;&nbsp;&nbsp;&nbsp;Total Non-GAAP operating expenses (B) | $25651 | $24956 | $18171 | $73246 | $52241 |
| &nbsp;&nbsp;&nbsp;&nbsp;GAAP operating loss | $(2886) | $(1739) | $(451) | $(4843) | $(15635) |
| &nbsp;&nbsp;&nbsp;&nbsp;Non-GAAP operating income (loss) (A-B) | $6694 | $3399 | $1394 | $15809 | $(11408) |
| &nbsp;&nbsp;&nbsp;&nbsp;GAAP operating loss margin | (5.3)% | (3.4)% | (1.4)% | (3.2)% | (22.7)% |
| &nbsp;&nbsp;&nbsp;&nbsp;Non-GAAP operating income (loss) margin | 12.3% | 6.6% | 4.3% | 10.3% | (16.4)% |
| &nbsp;&nbsp;&nbsp;&nbsp;GAAP net income (loss) | $2823 | $(3360) | $(144) | $(610) | $(16821) |
| &nbsp;&nbsp;&nbsp;&nbsp;Reconciling items: |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Warrant contra revenue | 260 | 247 | 407 | 895 | 407 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Share-based compensation | 5169 | 4891 | 1438 | 15606 | 3820 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Impairment and related charges | 4151 |  |  | 4151 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Pre-tax total reconciling items | 9580 | 5138 | 1845 | 16501 | 4227 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Other income tax effects and adjustments | (4952) | 644 | 700 | (4732) | (438) |
| &nbsp;&nbsp;&nbsp;&nbsp;Non-GAAP net income (loss) | $7451 | $2422 | $2401 | $11159 | $(13032) |
| &nbsp;&nbsp;&nbsp;&nbsp;GAAP weighted average shares - basic | 146908 | 146012 | 73815 | 146000 | 70439 |
| &nbsp;&nbsp;&nbsp;&nbsp;GAAP weighted average shares - diluted | 156519 | 146012 | 73815 | 146000 | 70439 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Non-GAAP adjustment | 3837 | 12789 | 10373 | 13088 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Non-GAAP weighted average shares - diluted | 160356 | 158801 | 84187 | 159088 | 70439 |
| &nbsp;&nbsp;&nbsp;&nbsp;GAAP diluted net income (loss) per share | $0.02 | $(0.02) | $— | $— | $(0.24) |
| &nbsp;&nbsp;&nbsp;&nbsp;Non-GAAP diluted net income (loss) per share | $0.05 | $0.02 | $0.03 | $0.07 | $(0.19) |

---

------

**Credo Technology Group Holding Ltd** 

**Reconciliation of GAAP Forward-Looking Estimates to Non-GAAP Forward-Looking Estimates**

**(In millions, except percentages)** 

---

| | | |
|:---|:---|:---|
| | **Three Months Ended April 29, 2023** | **Three Months Ended April 29, 2023** |
| | **Low** | **High** |
| &nbsp;&nbsp;&nbsp;&nbsp;GAAP gross margin | 55.8% | 57.8% |
| &nbsp;&nbsp;&nbsp;&nbsp;Reconciling items: |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Warrant contra revenue | 0.1% | 0.1% |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Share-based compensation | 0.1% | 0.1% |
| &nbsp;&nbsp;&nbsp;&nbsp;Total reconciling items: | 0.2% | 0.2% |
| &nbsp;&nbsp;&nbsp;&nbsp;Non-GAAP gross margin | 56.0% | 58.0% |
| &nbsp;&nbsp;&nbsp;&nbsp;Total GAAP operating expenses | $32.8 | $34.8 |
| &nbsp;&nbsp;&nbsp;&nbsp;Reconciling item: |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Share-based compensation | 6.8 | 6.8 |
| &nbsp;&nbsp;&nbsp;&nbsp;Total reconciling items: | 6.8 | 6.8 |
| &nbsp;&nbsp;&nbsp;&nbsp;Total Non-GAAP operating expenses | $26.0 | $28.0 |

---

<br>