Astera Labs Announces Financial Results for the Second Quarter of Fiscal Year 2025

Record quarterly revenue of $191.9 million, up 20% QoQ and 150% YoY, and record operating cash flow generation of $135.4 million Industry leading PCIe 6 connectivity portfolio ramping in volume on customized rack-scale AI systemsScorpio Fabric Switch design wins expand across multiple new customers and applications SAN JOSE, Calif., Aug. 05, 2025 (GLOBE NEWSWIRE) -- Astera Labs, Inc. (Nasdaq: ALAB), a leader in semiconductor-based connectivity solutions for rack-scale AI infrastructure, today announced preliminary financial results for the second quarter of fiscal year 2025, ended June 30, 2025. “Astera Labs delivered strong financial results in Q2 with sequential revenue growth of 20 percent, driving meaningful upside to earnings and cash flow from operations,” said Jitendra Mohan, Astera Labs’ Chief Executive Officer. “During Q2, we successfully executed the next step in our growth journey by ramping our PCIe 6 product portfolio into volume production for customized rack-scale AI systems and added multiple new design wins for our Scorpio Fabric Switches. We also saw strong demand for our signal conditioning portfolio driven by PCIe scale-up and Ethernet scale-out connectivity applications in custom ASIC platforms. Astera Labs is at the forefront of an AI infrastructure transformation, and we are accelerating our investments to realize our vision of rack-scale connectivity in next-generation AI systems.” Second Quarter 2025 Financial Highlights GAAP Financial Results: Revenue of $191.9 million, up 20% sequentially and up 150% year-over-yearGAAP gross margin of 75.8%GAAP operating income of $39.8 millionGAAP operating margin of 20.7%GAAP net income of $51.2 millionGAAP diluted earnings per share of $0.29 Non-GAAP Financial Results (excluding the impact of stock-based compensation expense and the income tax effects of non-GAAP adjustments): Non-GAAP gross margin of 76.0%Non-GAAP operating income of $75.2 millionNon-GAAP operating margin of 39.2%Non-GAAP net income of $78.0 millionNon-GAAP diluted earnings per share of $0.44 Q2 2025 and Recent Business Highlights Expanded collaboration with NVIDIA to advance the NVLink Fusion ecosystem and expand the options available for hyperscalers to deploy high-performance, scale-up networks based on NVIDIA NVLink technology. Astera Labs will provide NVLink connectivity solutions to further expand our Intelligent Connectivity Platform, which seamlessly integrates PCIe, CXL, and Ethernet silicon and hardware solutions with the COSMOS suite to enhance data center visibility while optimizing system performance.Hosted comprehensive Ultra Accelerator Link (“UALink”) public webinar to discuss the fundamentals of the UALink technology, outline the UALink market opportunity, and demonstrate how Astera Labs is uniquely positioned to help proliferate the open, memory-semantic fabric that delivers high-bandwidth, low latency, and broad interoperability. As a Promoter Member of the UALink Consortium, Astera Labs is working closely with industry partners to advance this open connectivity ecosystem that helps unleash the next generation of performant, efficient, and scalable AI platforms.Joined AMD on stage for its Advancing AI 2025 keynote presentation as a trusted partner to help showcase the ecosystem collaborating to power the next era of AI. Together, the two companies highlighted how UALink connectivity solutions will be critical for enabling innovative scale-up architectures for the next generation of AI infrastructure. UAL represents the only open standard designed specifically for scale-up applications. It combines the best of many protocols to provide a fast and efficient architecture supported by a broad ecosystem to deliver choice and flexibility to customers.Announced partnership with high-performance ASIC leader, Alchip Technologies, to advance the silicon ecosystem for AI rack-scale infrastructure through the seamless integration of purpose-built compute and connectivity solutions. The collaboration combines Alchip’s custom ASIC development capabilities with Astera Labs’ comprehensive connectivity portfolio to deliver validated and interoperable solutions for hyperscalers building next-generation AI infrastructure. Third Quarter of Fiscal 2025 Financial Outlook Based on current business trends and conditions, Astera Labs estimates the following: GAAP Financial Outlook: Revenue within a range of $203 million to $210 millionGAAP gross margin of approximately 75%GAAP operating expenses within a range of approximately $116 million to $120 millionGAAP tax rate of approximately 10%GAAP diluted earnings per share in a range of approximately $0.23 to $0.24 on weighted-average diluted shares outstanding of approximately 180 million Non-GAAP Financial Outlook (excluding the impact of stock-based compensation expense and the income tax effects of non-GAAP adjustments): Non-GAAP gross margin of approximately 75%Non-GAAP operating expenses within a range of approximately $76 million to $80 millionNon-GAAP tax rate of approximately 20%Non-GAAP diluted earnings per share in a range of approximately $0.38 to $0.39 on non-GAAP weighted-average diluted shares outstanding of approximately 180 million Earnings Webcast and Conference CallAstera Labs will host a conference call to review its financial results for the second quarter of fiscal 2025 and to discuss our financial outlook today at 1:30 p.m. Pacific Time. Interested parties may join the conference call by dialing 1-800-715-9871 and using conference ID 5908687. The call will also be webcast and can be accessed at the Astera Labs website at https://ir.asteralabs.com/. The webcast will be recorded and available for replay on the company’s website for the next six months. Discussion of Non-GAAP Financial MeasuresWe use certain non-GAAP financial measures, including those concerning our financial outlook, to supplement the performance measures in our consolidated financial statements, which are presented in accordance with GAAP. A reconciliation of these non-GAAP measures to the closest GAAP measure can be found later in this release. The timing and impact of any adjustments to arrive at the corresponding GAAP financial measures concerning our financial outlook are inherently dependent on future events that are typically uncertain or that may be outside of our control. These non-GAAP financial measures include non-GAAP gross profit, non-GAAP gross margin, non-GAAP operating expenses, non-GAAP operating income, non-GAAP operating margin, non-GAAP tax rate, non-GAAP net income, non-GAAP pro forma diluted earnings per share, and non-GAAP pro forma weighted-average share count. We use these non-GAAP financial measures for financial and operational decision-making and as a means to assist us in evaluating period-to-period comparisons. By excluding certain items that may not be indicative of our recurring core operating results, we believe that, non-GAAP gross profit, non-GAAP gross margin, non-GAAP operating expenses, non-GAAP operating income, non-GAAP operating margin, non-GAAP tax rate, non-GAAP net income, non-GAAP pro forma diluted earnings per share, and non-GAAP pro forma weighted-average share count provide meaningful supplemental information regarding our performance. Accordingly, we believe these non-GAAP financial measures are useful to investors and others because they allow for additional information with respect to financial measures used by management in its financial and operational decision-making and they may be used by our institutional investors and the analyst community to help them analyze the health of our business. However, there are a number of limitations related to the use of non-GAAP financial measures, and these non-GAAP measures should be considered in addition to, not as a substitute for or in isolation from, our financial results prepared in accordance with GAAP. Other companies, including companies in our industry, may calculate these non-GAAP financial measures differently or not at all, which reduces their usefulness as comparative measures. We adjust the following items from one or more of our non-GAAP financial measures: Stock-based compensation expense We exclude stock-based compensation expense, which is a non-cash expense, from certain of our non-GAAP financial measures because we believe that excluding this item provides meaningful supplemental information regarding operational performance. In particular, companies calculate non-cash stock-based compensation expense using a variety of valuation methodologies and subjective assumptions. Moreover, stock-based compensation expense is a non-cash charge that can vary significantly from period to period for reasons that are unrelated to our core operating performance, and therefore excluding this item provides investors and other users of our financial information with information that allows meaningful comparisons of our business performance across periods. Employer payroll taxes related to stock-based compensation resulting from our IPO We exclude employer payroll taxes related to the time-based vesting and net settlement of restricted stock units in connection with our initial public offering (the “IPO”), because this does not correlate to the operation of our business. We believe that excluding this item provides meaningful supplemental information regarding operational performance given the amount of employer payroll tax-related items on employee stock transactions was immaterial prior to our IPO. Income tax effectThis represents the impact of the non-GAAP adjustments on an after-tax basis and one-off discrete tax adjustments that are unrelated to our core operating performance in connection with the presentation of non-GAAP net income and non-GAAP net income per diluted share. This approach is designed to enhance investors’ ability to understand the impact of our non-GAAP tax expense on our current operations, provide improved modeling accuracy, and substantially reduce fluctuations caused by GAAP to non-GAAP adjustments. Non-GAAP pro forma weighted-average shares to compute non-GAAP pro forma net income per share We present non-GAAP pro forma weighted-average shares, assuming our redeemable convertible preferred stock is converted from the beginning of each respective periods presented, to provide meaningful supplemental information regarding EPS trend on a consistent basis. All of our outstanding redeemable preferred stock converted into the equivalent number of shares of common stock in connection with our IPO. Cautionary Note Regarding Forward-Looking StatementsThis press release contains forward-looking statements based on Astera Labs' current expectations. The words “accelerating,” “advance,” “beginning,” "believe," “confidence,” “committed,” “continue,” “deliver,” “enable,” "estimate," “expand,” "expect," “goal,” “guidance,” "intend," “look,” “may,” “momentum,” “on track,” “opportunities,” “proliferate,” “prospects,” “provide,” “represent,” “roadmaps,” “upside,” “vision,” "will," and similar phrases as they relate to Astera Labs are intended to identify such forward-looking statements. These forward-looking statements reflect the current views and assumptions of Astera Labs as of August 5, 2025, and are subject to various assumptions, beliefs, risks and uncertainties that could cause actual results to differ materially from expectations. These forward-looking statements include, but are not limited to, statements regarding our future business, operating results, cash flow, financial position and guidance (and any underlying drivers), including for the third quarter of fiscal 2025; our business strategy, plans and market opportunities, including the expected catalysts, our rack scale connectivity vision, our associated investments, our growth profile and our ability to further build upon the new revenue base, expand our product offerings, increase our market opportunity, remain at the forefront of an AI infrastructure transformation, and scale our connectivity platform; our objectives for future operations; our production, development, shipping and delivery of, activity, applications and demand for, as well as absolute and relative revenue and growth (including the drivers) from, existing, new, growing or enhanced products such as our PCIe 6 connectivity portfolio, signal conditioning portfolio, and Scorpio P-Series Smart Fabric Switches and the performance and results of those products for our customers; the timing, impact and proliferation of different connectivity standards; the plans and potential success of our announced and ongoing collaborations, partnerships and strategic relationships; our competitive positioning and the impacts thereof; our R&D and strategic IP plans; and future industry and macroeconomic conditions, events and trends such as in cloud and AI infrastructure as well as our preparedness and solutions for them. A variety of risks and factors that are beyond our control could cause actual results to differ materially from those in the forward-looking statements including, without limitation: the competitive and cyclical nature of the semiconductor industry; the concentration of our customer base; the changes in demand for AI; the macroeconomic and/or geopolitical environment, including economic uncertainty and volatility in the capital markets; risks that demand for our products and the supply chain may be adversely affected, including by the imposition of tariffs by the United States or any other jurisdiction and any corresponding retaliatory tariffs, changes in political policies, military conflict (such as between Russia/Ukraine and Israel/Hamas), terrorism, sanctions or other geopolitical events globally (including conflict between Taiwan and China); quarterly fluctuations in revenues and operating results; difficulties developing new products that achieve market acceptance; risks associated with managing international activities (including trade barriers, particularly with respect to China); absence of long-term commitments from customers; risks that Astera Labs may not be able to manage strains associated with its growth; credit risks associated with its accounts receivable; stock price volatility; information technology risks, including cyber-attacks against Astera Labs' products and its networks; and other risks and uncertainties that are detailed under the caption “Risk Factors” and elsewhere in our Annual Report on 10-K, as filed with the Securities and Exchange Commission (the “SEC”) on February 14, 2025, and in subsequent Quarterly Reports on Form 10-Q filed with the SEC and the other SEC filings and reports Astera Labs may make from time to time. Moreover, we operate in a very competitive and rapidly changing environment, and new risks may emerge from time to time. It is not possible for our management to predict all risks, nor can we assess the impact of all factors on our business or the extent to which any factor(s) may cause actual results or outcomes to differ materially from those contained in any forward-looking statements we may make. Accordingly, you should not unduly rely on any of the forward-looking statements. Astera Labs disclaims any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events, or otherwise, except as required by law. About Astera Labs Astera Labs (NASDAQ: ALAB) provides rack-scale AI infrastructure through purpose-built connectivity solutions grounded in open standards. By collaborating with hyperscalers and ecosystem partners, Astera Labs enables organizations to unlock the full potential of modern AI. Astera Labs’ Intelligent Connectivity Platform integrates CXL®, Ethernet, PCIe®, and UALink™ semiconductor-based technologies with the company’s COSMOS software suite to unify diverse components into cohesive, flexible systems that deliver end-to-end scale-up, and scale-out connectivity. Discover more at www.asteralabs.com. ASTERA LABS, INC. CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited)(In thousands) As of June 30,2025 December 31,2024Assets Current assets Cash and cash equivalents$162,328 $79,551 Marketable securities 902,758 834,750 Accounts receivable, net 24,318 38,811 Inventory 58,602 43,215 Prepaid expenses and other current assets 32,742 16,652 Total current assets 1,180,748 1,012,979 Property and equipment, net 62,075 35,651 Other assets 28,582 5,878 Total assets$1,271,405 $1,054,508 Liabilities and Stockholders’ EquityCurrent liabilities Accounts payable$31,573 $26,918 Accrued expenses and other current liabilities 74,810 59,624 Total current liabilities 106,383 86,542 Other liabilities 29,308 3,167 Total liabilities 135,691 89,709 Stockholders’ equity Common stock 17 16 Additional paid-in capital 1,258,581 1,173,153 Accumulated other comprehensive income 2,874 426 Accumulated deficit (125,758) (208,796)Total stockholders’ equity 1,135,714 964,799 Total liabilities and stockholders’ equity$1,271,405 $1,054,508 ASTERA LABS, INC. CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited)(In thousands, except per share amounts) Three Months Ended Six Months Ended June 30,2025 March 31,2025 June 30,2024 June 30,2025 June 30,2024Revenue$191,925 $159,442 $76,850 $351,367 $142,108 Cost of revenue 46,362 40,031 16,996 86,393 31,734 Gross profit 145,563 119,411 59,854 264,974 110,374 Operating expenses Research and development 66,724 64,554 40,089 131,278 93,647 Sales and marketing 18,609 21,702 22,076 40,311 77,586 General and administrative 20,456 21,870 22,036 42,326 46,455 Total operating expenses 105,789 108,126 84,201 213,915 217,688 Operating income (loss) 39,774 11,285 (24,347) 51,059 (107,314)Interest income 10,885 10,432 10,264 21,317 12,818 Income (loss) before income taxes 50,659 21,717 (14,083) 72,376 (94,496)Income tax (benefit) provision (560) (10,102) (6,537) (10,662) 6,045 Net income (loss)$51,219 $31,819 $(7,546) $83,038 $(100,541) Net income (loss) per share attributable to common stockholders: Basic$0.31 $0.19 $(0.05) $0.51 $(0.97)Diluted$0.29 $0.18 $(0.05) $0.47 $(0.97)Weighted-average shares used in calculating net income (loss) per share attributable to common stockholders: Basic 165,428 163,194 155,199 164,316 103,865 Diluted 178,100 178,116 155,199 178,281 103,865 ASTERA LABS, INC. CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) (In thousands) Six Months Ended June 30,2025 June 30,2024Cash flows from operating activities Net income (loss)$83,038 $(100,541)Adjustments to reconcile net income (loss) to net cash provided by operating activities Stock-based compensation 77,920 140,835 Depreciation and amortization 2,517 1,331 Non-cash operating lease expense 1,522 1,106 Warrants contra revenue 2,136 443 Accretion of discounts on marketable securities (4,489) (1,670)Other, net 734 1,526 Changes in operating assets and liabilities: Accounts receivable, net 14,491 (13,898)Inventory (14,577) (5,970)Prepaid expenses and other assets (18,474) (5,396)Accounts payable 4,607 5,831 Accrued expenses and other liabilities (1,592) 10,930 Operating lease liability (1,963) (1,062)Net cash provided by operating activities 145,870 33,465 Cash flows from investing activities Purchases of property and equipment (6,562) (2,100)Purchases of marketable securities (404,682) (345,756)Sales and maturities of marketable securities 343,611 41,134 Net cash used in investing activities (67,633) (306,722) Cash flows from financing activities Proceeds from issuance of common stock in connection with initial public offering, net of underwriting discounts and commissions — 672,198 Payment of deferred offering costs — (4,801)Tax withholding related to net share settlements of restricted stock units — (20,111)Proceeds from exercises of stock options, net of repurchases 778 1,949 Proceeds from employee stock purchase plan 4,345 — Net cash provided by financing activities 5,123 649,235 Net increase in cash, cash equivalents, and restricted cash 83,360 375,978 Cash, cash equivalents, and restricted cash Beginning of the period 80,044 45,098 End of the period$163,404 $421,076 ASTERA LABS, INC. RECONCILIATION OF GAAP TO NON-GAAP FINANCIAL MEASURES (Unaudited) (In thousands, except percentages and per share amounts) Three Months Ended Six Months Ended June 30,2025 March 31,2025 June 30,2024 June 30,2025 June 30,2024GAAP gross profit$145,563 $119,411 $59,854 $264,974 $110,374 Stock-based compensation expense upon IPO (1) — — — — 516 Stock-based compensation expense 353 (38) 84 315 96 Non-GAAP gross profit$145,916 $119,373 $59,938 $265,289 $110,986 GAAP gross margin 75.8% 74.9% 77.9% 75.4% 77.7%Stock-based compensation expense upon IPO (1) — — — — 0.3 Stock-based compensation expense 0.2 — 0.1 0.1 0.1 Non-GAAP gross margin 76.0% 74.9% 78.0% 75.5% 78.1% GAAP operating income (loss)$39,774 $11,285 $(24,347) $51,059 $(107,314)Stock-based compensation expense upon IPO (1) — — — — 88,873 Stock-based compensation expense 35,474 42,446 43,067 77,920 51,962 Employer payroll tax related to stock-based compensation from IPO (2) — — — — 1,072 Non-GAAP operating income$75,248 $53,731 $18,720 $128,979 $34,593 GAAP operating margin 20.7% 7.1% (31.7)% 14.5% (75.5)%Stock-based compensation expense upon IPO (1) — — — — 62.5 Stock-based compensation expense 18.5 26.6 56.0 22.2 36.6 Employer payroll tax related to stock-based compensation from IPO (2) — — — — 0.8 Non-GAAP operating margin (3) 39.2% 33.7% 24.4% 36.7% 24.3% GAAP net income (loss)$51,219 $31,819 $(7,546) $83,038 $(100,541)Stock-based compensation expense upon IPO (1) — — — — 88,873 Stock-based compensation expense 35,474 42,446 43,067 77,920 51,962 Employer payroll tax related to stock-based compensation from IPO (2) — — — — 1,072 Income tax effect (4) (8,670) (14,638) (13,296) (23,308) (4,811)Non-GAAP net income$78,023 $59,627 $22,225 $137,650 $36,555 Net income (loss) per share attributable to common stockholders: GAAP - basic$0.31 $0.19 $(0.05) $0.51 $(0.97)GAAP - diluted$0.29 $0.18 $(0.05) $0.47 $(0.97)Non-GAAP pro forma - diluted$0.44 $0.33 $0.13 $0.77 $0.23 Weighted average shares used to compute net income (loss) per share attributable to common stockholders:GAAP - basic 165,428 163,194 155,199 164,316 103,865 GAAP - diluted 178,100 178,116 155,199 178,281 103,865 Non-GAAP pro forma - diluted (5) 178,100 178,116 175,279 178,281 162,378 ____________________(1) Stock-based compensation expense recognized in connection with the time-based vesting and settlement of RSUs that had previously met the time-based vesting condition and for which the liquidity event vesting condition was satisfied in connection with our IPO.(2) Employer payroll taxes related to the time-based vesting and settlement of RSUs, that had previously met the time-based vesting condition and for which the liquidity event vesting condition was satisfied in connection with our IPO.(3) Total may not sum due to rounding.(4) Income tax effect is calculated based on the tax laws in the jurisdictions in which we operate and is calculated to exclude the impact of stock-based compensation expense and one-off discrete tax adjustments that are unrelated to our core operating performance. We no longer maintain valuation allowance for non-GAAP purposes due to our profitability on a non-GAAP basis. For the three months ended June 30, 2025, March 31, 2025, and June 30, 2024, the non-GAAP tax expense rate was approximately 9%, 7%, and 23%, respectively. For the six months ended June 30, 2025 and 2024, the non-GAAP tax expense rate was approximately 8% and 23%, respectively.(5) We present the non-GAAP pro-forma weighted average shares to provide meaningful supplemental information of comparable shares for each period presented. The non-GAAP pro forma weighted average shares is calculated as follows: Three Months Ended Six Months Ended June 30,2025 March 31,2025 June 30,2024 June 30,2025 June 30,2024Shares used to compute GAAP net income (loss) per share attributable to common stockholders - diluted178,100 178,116 155,199 178,281 103,865Weighted average effect of the assumed conversion of redeemable convertible preferred stock from the beginning of the periods— — — — 40,451Effect of dilutive equivalent shares— — 20,080 — 18,062Shares used to compute non-GAAP pro forma net income per share - diluted178,100 178,116 175,279 178,281 162,378 ASTERA LABS, INC., RECONCILIATION OF GAAP TO NON-GAAP OUTLOOK (Unaudited) (In millions, except percentages and per share amounts) Outlook for Three Months Ending September 30, 2025 Low HighGAAP gross margin 75.0% 75.0%Stock-based compensation expense — — Non-GAAP gross margin 75.0% 75.0% GAAP operating expense$116 $120 Stock-based compensation expense 40 40 Non-GAAP operating expense$76 $80 GAAP tax rate 10% 10%Income tax effect 10 10 Non-GAAP tax rate 20% 20% GAAP EPS - diluted$0.23 $0.24 Stock-based compensation expense and income tax effect 0.15 0.15 Non-GAAP EPS - diluted$0.38 $0.39 ASTERA LABS, INC. SUPPLEMENTAL FINANCIAL INFORMATION STOCK-BASED COMPENSATION EXPENSE (Unaudited) (In thousands) Three Months Ended Six Months Ended June 30,2025 March 31,2025 June 30,2024 June 30,2025 June 30,2024Cost of revenue$353 $(38) $84 $315 $612Research and development 17,852 19,186 12,971 37,038 42,978Sales and marketing 9,194 12,319 15,758 21,513 65,016General and administrative 8,075 10,979 14,254 19,054 32,229Total stock-based compensation expense (1)$35,474 $42,446 $43,067 $77,920 $140,835 ____________________(1) Stock-based compensation expense recognized during the six months ended June 30, 2024 included $88.9 million of cumulative stock-based compensation expense related to the time-based vesting and settlement of RSUs that had previously met the time-based vesting condition and for which the liquidity event vesting condition was satisfied in connection with our IPO. IR CONTACT: Leslie Greenleslie.green@asteralabs.com

Astera Labs Announces Financial Results for the Second Quarter of Fiscal Year 2025

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