Astera Labs, Inc. Common Stock Q4 FY2025 earnings call

Management Statement and Operational Highlights

• Financial Performance: Q4 2025 revenue was $270.6M, up 17% Q/Q and 92% YOY; full-year 2025 revenue $852.5M, up 115% YOY.
• Market Trends: Secular trends in AI and cloud infrastructure strong, with top US hyperscalers guiding significant CapEx.
• Product Progress: Scorpio P Series volume ramp, UA Link ecosystem development, Ares growth, Taurus strong performance, Leo CXL partnership.
• Strategic Investments: Expansion of global engineering operations with Israel design center, investment in team and capabilities.
• Leadership Changes: Mike Tate transitions to strategic adviser; Desmond Lynch joins as new CFO effective March 2.

Segment Performance

• Scorpio: P Series had volume ramp in 2025, exceeding 10% of revenue and being the only PCIe six fabric shipping in volume. X Series expected to incrementally grow revenue in 2026 with initial shipments in 2026 and volume ramps in 2027.
• UA Link: Vibrant ecosystem with product announcements, IP availability, and compliance methodologies finalized; ready for customer platform ramp in 2027.
• Ares: PCIe six solutions contributed robust growth in 2025, growing nearly 70% YOY, expected to continue growth in 2026 and beyond.
• Taurus: Strongest performing in 2025, revenue grew over four times YOY driven by 400 gig designs, with transition to 800 gig switching platforms as next catalyst.
• Leo CXL: Partnership with Microsoft, Intel, SAP announced, with initial production volumes in 2026.

Guidance

• Q1 2026 revenue expected to be in the range of $286 million to $297 million, up roughly 6% to 10% from Q4 2025 levels.
• Q1 non-GAAP gross margins are expected to be approximately 74%, with non-GAAP operating expenses in the range of approximately $112 million to $118 million.
• Interest income is expected to be approximately $11 million, non-GAAP tax rate should be approximately 12%, and non-GAAP fully diluted earnings per share is expected to be approximately $0.53 to $0.54.

Risks

• Forward-looking statements subject to risks and uncertainties, including those discussed in the earnings release and SEC filings.
• Uncertainties in market adoption of new products and technologies.
• Competition and execution risks in scaling operations and meeting customer demands.

Q: Congrats on the results and Mike's new role. Ask about UA Link and NVLink mix.

A: Jitendra Mohan states AWS and AMD support UA Link, NVLink fusion is an opportunity, and there's a warrant agreement with Amazon for $6.5 billion related to smart fabric switches, signal conditioning, and optical engine solutions.

Q: OpEx increase, acquisition impact.

A: Mike Tate mentions advanced customer opportunities driving OpEx increase, including the XScale acquisition and AQUI hire for Israel design center to pursue customer-driven opportunities.

Q: Scorpio P and X growth, SAM by 2030.

A: Sanjay Gajendra talks about software-defined fabrics, customization in scale-up, and investment in R&D to capitalize on growing market opportunities and reach half of the $20 billion SAM by 2030 in the near to medium term.