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SANTA CLARA, Calif. - Astera Labs Inc. (NASDAQ:ALAB), a $14.93 billion market cap company known for its semiconductor-based connectivity solutions, has announced a collaboration with NVIDIA to enhance the NVLink Fusion ecosystem with new scale-up connectivity solutions. The partnership aims to address the needs of hyperscalers deploying high-performance AI networks, as AI models grow increasingly complex. According to InvestingPro data, Astera Labs maintains impressive gross profit margins of 75.76%, demonstrating strong operational efficiency in the semiconductor space.
Astera Labs’ NVLink solutions will become part of its Intelligent Connectivity Platform, which already integrates PCIe®, CXL®, and Ethernet technologies along with its COSMOS software suite. This expansion is designed to provide hyperscalers with efficient options for deploying heterogeneous compute-based AI infrastructures involving NVIDIA GPUs and custom accelerators. InvestingPro analysis shows the company’s strong financial health, with 10 analysts recently revising their earnings estimates upward. For deeper insights into Astera Labs’ growth potential and comprehensive financial analysis, investors can access the detailed Pro Research Report available on InvestingPro.
The collaboration builds on a history of joint efforts between the two companies. Astera Labs has supported NVIDIA’s accelerated computing platform across several generations, including the NVIDIA Hopper and NVIDIA HGX platforms. Notably, Astera Labs showcased the first end-to-end PCIe 6 interoperability with Scorpio P-Series Fabric Switches, Aries 6 Retimers, and an NVIDIA Blackwell GPU at NVIDIA GTC 2025.
Sanjay Gajendra, President and COO of Astera Labs, emphasized the importance of this collaboration for meeting the demands of rapidly evolving AI infrastructure. Ashish Karandikar, Vice President of SoC Products at NVIDIA, echoed this sentiment, highlighting the role of industry partnerships in scaling high-performance AI factories capable of handling intensive workloads.
The announcement suggests that Astera Labs is poised to further solidify its market position by expanding its product offerings to include NVLink solutions. This move is expected to enhance the company’s ability to meet the specific requirements of hyperscalers in the AI infrastructure space. The company’s strong momentum is reflected in its recent performance, with a 12.81% return over the past week and remarkable revenue growth of 200.19% in the last twelve months. InvestingPro’s analysis indicates the stock is currently trading above its Fair Value, suggesting investors should carefully consider entry points.
The information presented is based on a press release statement from Astera Labs.
In other recent news, Astera Labs reported first-quarter earnings that exceeded analyst expectations, with adjusted earnings per share reaching $0.33 compared to the estimated $0.10. The company also announced a revenue of $159.4 million for the quarter, marking a 144% year-over-year increase and a 13% sequential rise. Despite the strong performance, Astera Labs’ stock fell following the announcement, as investors appeared unimpressed with the second-quarter guidance. The company projected second-quarter adjusted EPS of $0.32-$0.33 and revenue between $170 million and $175 million, slightly above the consensus estimates. CEO Jitendra Mohan noted the strong demand for their connectivity solutions and highlighted the upcoming ramp-up of their PCIe 6 connectivity portfolio. In other developments, Morgan Stanley upgraded Astera Labs’ stock rating from Equalweight to Overweight, setting a price target of $99.00. The firm cited Astera Labs’ growth potential, driven by investments in hyperscale data centers and application-specific integrated circuits. Morgan Stanley believes the company’s strong focus on artificial intelligence and attractive valuation present a compelling opportunity for investors.
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