Astera Labs revenue jumps 104% as Scorpio fabric switches ramp

Astera Labs reported Q2 revenue of $392.4 million, up 104 percent year over year and beating consensus by $31.7 million.

"Astera Labs delivered outstanding Q2 2026 results, with record revenue of $392.4 million, up 27 percent sequentially and 104 percent year-over-year, driven by broad-based strength across our portfolio," Jitendra Mohan, chief executive officer at Astera Labs, said.

Non-GAAP EPS came in at $0.80, beating the $0.69 consensus estimate. Non-GAAP gross margin was 73.7 percent, and non-GAAP operating margin reached 39.1 percent. The Aries product line posted record quarterly revenue.

Shares rose 5.07 percent to $380.01 in extended trading. Management guided Q3 non-GAAP EPS of $1.16 to $1.21, with Scorpio fabric switches expected to become the company's largest product family one quarter ahead of prior expectations.

GAAP net income for the quarter was $153.1 million, or $0.83 per diluted share, compared with $51.2 million, or $0.29 per diluted share, in the year-ago period. First-half revenue reached $700.8 million, double the $351.4 million reported in the same period last year. The company's balance sheet strengthened, with cash and marketable securities at $1.25 billion at quarter end, up from $1.19 billion at the start of the year.

The company cited new design wins across a broadening set of customers, expansion into optical interconnects, and custom solutions as growth drivers for 2027 and beyond. Astera Labs also highlighted its warrant agreement with Amazon and the opening of a new Israel Design Center as part of its expanded global footprint. Management noted that the Scorpio X-Series 320-L is moving into high-volume production deployment.

The results come as hyperscalers accelerate AI infrastructure spending, with Astera Labs' connectivity products competing against switching and interconnect solutions from Broadcom and Nvidia. The company's Intelligent Connectivity Platform integrates CXL, Ethernet, NVLink Fusion, PCIe, and UALink technologies with its COSMOS software suite. The UALink 2.0 standard, which Astera Labs is helping to define, is designed to provide a purpose-built AI compute fabric capable of scaling with industry needs.

Q3 guidance implies continued acceleration, with management projecting non-GAAP gross margin of 72 percent and non-GAAP operating expenses of $156 million to $160 million. The sequential revenue increase would mark one of the fastest growth rates in the company's history as a public company.

The guidance raise indicates management expects AI connectivity demand to accelerate through the second half of the year. Investors will watch the Q3 earnings call for updated Scorpio margin data and progress on the optical interconnect roadmap.

This article is for informational purposes only and does not constitute investment advice.