Astera Labs Stock Earnings Reports

Astera Labs reported a strong Q3 FY2025 with revenue of $230.6M (up 20% sequentially and 104% YoY) and record non-GAAP operating margin of 41.7%. Growth was broad-based across Scorpio (fabric switches), Aries (PCIe retimers), and Taurus (smart cable modules). PCIe Gen6 products contributed >20% of Q3 revenue. Scorpio P-Series is in initial volume ramp at a lead customer and has new design wins across multiple hyperscalers; Scorpio X-Series is shipping preproduction units with a volume ramp expected in 2026. The company is pursuing optical scale-up via the announced acquisition of Xscale Photonics to enable future photonic-enabled Scorpio switches (optical revenue expected to materialize in the 2028–2029 timeframe). Astera is engaged with >10 AI platform providers on scale-up connectivity (PCIe and UALink) and expects early UALink revenues in 2027. Q4 revenue guidance: $245M–$253M (up ~6–10% QoQ); Q4 non-GAAP gross margin ~75%; non-GAAP diluted EPS ~$0.51. Cash and marketable securities were $1.13B at quarter end. Management emphasized focus on open standards, multi-generation design engagements, continued R&D investment, team scaling (>700 employees planned by year-end), and opportunities from increasing AI rack-scale deployments. Key risks include customer concentration in hyperscalers, timing/complexity of new program ramps, and execution of optical roadmap.