Astera Labs (ALAB) Q4 2025 earnings summary

Executive summary

• Q4 2025 revenue reached $270.6M, up 17% sequentially and 92% year-over-year; FY25 revenue was $852.5M, up 115% from FY24.

• Growth was broad-based across signal conditioning, smart cable modules, and switch fabric portfolios, with new design wins and customer diversification.

• Strong AI and cloud infrastructure demand, with major hyperscalers like Google and AWS driving robust CapEx spending.

• Announced a strategic partnership with Microsoft, Intel, and SAP for CXL memory expansion in Azure, marking the first public deployment of CXL-attached memory.

• Leadership transition: Mike Tate to strategic advisor, Desmond Lynch appointed as new CFO effective March 2, 2026.

Financial highlights

• Q4 non-GAAP gross margin was 75.7%, down 70 bps sequentially due to higher hardware sales mix.

• Q4 non-GAAP operating expenses were $96M, up $16M sequentially, driven by R&D expansion and the X-Scale acquisition.

• Q4 non-GAAP operating margin was 40.2%; Q4 GAAP operating margin was 24.7%.

• Q4 non-GAAP diluted EPS was $0.58; cash flow from operations was $95.3M; cash and equivalents ended at $1.19B.

• FY25 non-GAAP EPS: $1.84; FY25 GAAP EPS: $1.22.

Outlook and guidance

• Q1 2026 revenue expected between $286M–$297M, up 6–10% sequentially.

• Q1 non-GAAP gross margin projected at ~74% due to increased hardware mix.

• Q1 non-GAAP operating expenses expected at $112M–$118M, reflecting investments in R&D and the Israel Design Center.

• Q1 non-GAAP diluted EPS expected at $0.53–$0.54; Q1 GAAP EPS: $0.36–$0.38.