Astera Labs Inc (ALAB) Q4 2025 Earnings Call Highlights: Record Revenue Growth Amid Strategic …

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Wed, February 11, 2026 at 2:02 PM GMT+9 4 min read

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**Q4 Revenue:** $270.6 million, up 17% from the prior quarter and 92% year-over-year.

**Full Year 2025 Revenue:** $852.5 million, up 115% from the previous year.

**Q4 Non-GAAP Gross Margin:** 75.7%, down 70 basis points from the previous quarter.

**Q4 Non-GAAP Operating Expenses:** $96 million, up $16 million from the previous quarter.

**Q4 Non-GAAP Operating Margin:** 40.2%, down 150 basis points from the previous quarter.

**Q4 Non-GAAP Diluted EPS:** $0.58.

**Q4 Cash Flow from Operating Activities:** $95.3 million.

**Cash and Marketable Securities:** $1.19 billion at the end of Q4.

**Q1 2026 Revenue Guidance:** $286 million to $297 million, up 6% to 10% from Q4 levels.

**Q1 2026 Non-GAAP Gross Margin Guidance:** Approximately 74%.

**Q1 2026 Non-GAAP Operating Expenses Guidance:** $112 million to $118 million.

**Q1 2026 Non-GAAP Diluted EPS Guidance:** $0.53 to $0.54.

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Release Date: February 10, 2026

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

Astera Labs Inc (NASDAQ:ALAB) reported strong Q4 2025 results with revenue of $270.6 million, up 17% from the prior quarter and 92% year-over-year.

For the full year 2025, revenue reached $852.5 million, marking a 115% increase compared to the previous year.

The company is benefiting from robust secular trends in AI and cloud infrastructure, with significant spending from major hyperscalers like Google and AWS.

Astera Labs Inc (NASDAQ:ALAB) has expanded its market opportunity significantly, with its addressable market expected to grow 10x to $25 billion over the next five years.

The company announced a strategic partnership with Microsoft, Intel, and SAP to enable PXL memory expansion capabilities, marking the first deployment of CXL attached memory in the industry.

Negative Points

Non-GAAP gross margin for Q4 2025 was 75.7%, down 70 basis points from the previous quarter due to a higher mix of hardware sales.

Non-GAAP operating expenses increased to $96 million in Q4, up $16 million from the previous quarter, driven by R&D expansion and acquisitions.

The company anticipates a non-cash hit to gross margins of about 2 points per quarter starting in Q2 2026 due to a warrant agreement with Amazon.

Astera Labs Inc (NASDAQ:ALAB) is facing significant competition and uncertainty in the adoption of new technologies like UA Link and ESON, which could impact future growth.

The transition to optical technologies for scale-up applications is expected to occur around 2028, which may delay revenue realization from these investments.

 






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Q & A Highlights

Q: Can you provide more details on the acceptance of the UA Link for next-gen designs and the mix between hybrid boxes and native UA Link? A: Jitendra Mohan, CEO, explained that AWS and AMD have announced support for UA Link in their upcoming products, indicating strong endorsement. The opportunity for Astera Labs is significant, with both native and custom solutions offering similar revenue potential. Michael Tate, CFO, added that a warrant agreement with Amazon highlights their strong relationship, involving $6.5 billion in product purchases.

Q: What is driving the significant increase in operating expenses, and how does it relate to your optical scale-up aspirations? A: Michael Tate, CFO, stated that the increase is due to significant revenue opportunities presented by customers, necessitating investment. Recent acquisitions and the establishment of a new design center in Israel are part of this strategy to capitalize on a larger-than-expected market opportunity.

Q: How do you see the competition between UA Link and Ethernet scale-up technologies? A: Jitendra Mohan, CEO, noted that different solutions will coexist, with hyper scales leveraging solutions that align with their software stacks. Customers using memory-centric protocols like PCI Express are likely to transition to UA Link, while those using Ethernet may continue with it or move to ESA.

Q: Can you provide an update on the Scorpio product line’s performance and future outlook? A: Michael Tate, CFO, reported that Scorpio exceeded 15% of sales in 2025, primarily driven by the P series. The X series is expected to ramp up in 2026, with Scorpio poised to become the largest product line, contributing significantly to revenue growth.

Q: How does the transition from copper to optical affect your product offerings and market position? A: Jitendra Mohan, CEO, explained that while copper will remain prevalent, the transition to optical is expected as bandwidth demands increase. Astera Labs is preparing for this shift, with optical deployments anticipated around 2028, complementing existing copper solutions.

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

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