Credo Technology Group Holding LtdCRDO

Credo Technology Group Holding Ltd Fair Value Disclosure

10-KFiled Jul 2, 20252 min read
Fair Value Measurements
Fair value is an exit price representing the amount that would be received in the sale of an asset or paid to transfer a liability in an orderly transaction between market participants. As such, fair value is a market-based measurement that should be determined based on assumptions that market participants would use in pricing an asset or a liability. As a basis for considering such assumptions, the accounting guidance establishes a three-tier value hierarchy, which prioritizes the inputs used in the valuation methodologies in measuring fair value:
Level 1 - Observable inputs that reflect quoted prices for identical assets or liabilities in active markets.
Level 2 - Other inputs that are directly or indirectly observable in the marketplace.
Level 3 - Unobservable inputs that are supported by little or no market activity.
The fair value hierarchy also requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value.
The Company measures the fair value of money market funds using Level 1 inputs. The Company’s certificates of deposit are classified as held to maturity securities as the Company intends to hold until their maturity dates. The certificates of deposit are valued using Level 2 inputs. Pricing sources may include industry standard data providers, security master files from large financial institutions, and other third-party sources used to determine a daily market value.
The following tables present the fair value of the financial instruments measured on a recurring basis, or measured at amortized cost which approximates fair value, as of May 3, 2025 and April 27, 2024 (in thousands).
May 3, 2025
Level 1Level 2Level 3Total
Cash equivalents:
Money market funds$148,036 $— $— $148,036 
Certificates of deposit
— $65,137 — $65,137 
Short-term investments:
Certificates of deposit
— 195,010 — 195,010 
Total cash equivalents and short-term investments$148,036 $260,147 $— $408,183 
April 27, 2024
Level 1Level 2Level 3Total
Cash equivalents:
Money market funds$57,175 $— $— $57,175 
Short-term investments:
Certificates of deposit
— 343,061 — 343,061 
Total cash equivalents and short-term investments$57,175 $343,061 $— $400,236 
The carrying amount of the Company’s financial instruments, including cash equivalents, short-term investments, accounts receivable and accounts payable, approximate their respective fair values because of their short maturities. As of May 3, 2025 and April 27, 2024, there were no unrealized loss or gains associated with the Company’s financial instruments. The interest income recognized during the years ended May 3, 2025, April 27, 2024 and April 29, 2023 was $18.8 million, $15.3 million and $4.7 million, respectively.

Historical Timeline

Fiscal YearFiled
2025Jul 2, 2025Showing above
2024Jun 24, 2024
2023Jun 23, 2023
2022Jun 8, 2022

About Fair Value Disclosures

Fair value disclosures classify all assets and liabilities measured at fair value into a three-level hierarchy: Level 1 (quoted market prices), Level 2 (observable inputs like yield curves), and Level 3 (unobservable inputs requiring management estimates). The proportion of Level 3 assets directly reflects how much of the balance sheet depends on internal models rather than market evidence.

Key signals: a growing Level 3 balance relative to total fair-value assets increases valuation uncertainty and earnings volatility risk. Watch for transfers between levels — assets moving from Level 2 to Level 3 often signal deteriorating market liquidity. Unrealized gains and losses on Level 3 positions flow through earnings or other comprehensive income, so large swings deserve scrutiny. For financial institutions, examine the sensitivity disclosures that show how Level 3 valuations change under alternative assumptions. Compare the fair value of debt against its carrying amount to gauge hidden leverage.

Other Available Disclosures

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