Credo Technology Group Holding Ltd 10-Q

Item 1A. Risk Factors. Our operations and financial results are subject to various risks and uncertainties, including those described in Part I, Item 1A, "Risk Factors" in our Annual Report on Form 10-K for the fiscal year ended April 30, 2022, which could adversely affect our business, financial condition, results of operations, cash flows, and the trading price of our stock. As of the date of this Quarterly Report on Form 10-Q, other than as described below, there have been no material changes from the risk factors previously disclosed in our in the Annual Report on Form 10-K for the fiscal year ended April 30, 2022. Our share price has been and may continue to be volatile and may decline, resulting in a loss of some or all of your investment. The public offering price for our ordinary shares will be determined by negotiations among us, the underwriters and the selling shareholders and may vary from the market price of our ordinary shares following this offering. If you purchase our ordinary shares in this offering, you may not be able to resell those shares at or above the public offering price, or at all. The trading price and volume of our ordinary shares has been and is likely to continue to be volatile. From January 27, 2022 (the first day of trading of our ordinary shares on Nasdaq) through the date of this prospectus, the trading price of our ordinary shares on Nasdaq has ranged from a high of $[18.00] to a low of $[8.61] per share, and in the future could fluctuate significantly in response to numerous factors, some of which are beyond our control, including but not limited to: • actual or anticipated fluctuations in our results of operations due to, among other things, changes in customer demand, product life cycles, pricing, ordering patterns, and unforeseen operating costs; • the financial projections we may provide to the public, any changes in these projections or our failure to meet these projections, including due to the foregoing business considerations; • failure of securities analysts to initiate or maintain coverage of us, changes in financial estimates or ratings by any securities analysts who follow us, or our failure to meet these estimates or the expectations of investors; • announcements by our significant customers of changes to their product offerings, business plans, or strategies; • announcements by us or our competitors of significant technical innovations, acquisitions, strategic partnerships, joint ventures, or capital commitments; • changes in operating performance and stock market valuations of other technology companies generally, or those in the data infrastructure industry; • timing and seasonality of the end-market demand; • cyclical fluctuations in the data infrastructure market; • price and volume fluctuations in the overall stock market from time to time, including as a result of trends in the economy as a whole; • actual or anticipated developments in our business or our competitors’ businesses or the competitive landscape generally; • new laws or regulations or new interpretations of existing laws, or regulations applicable to our business; • changes in general global economic conditions, including as a result of the reduced growth in the U.S. economy during the first two quarters of 2022, combined with the expected decline in the rate of economic 28 growth in Europe, China, and globally in 2022 and into 2023, which can have a negative effect on demand for our products; • the impacts of rising inflation, which can have an impact on the cost of our components and/or decrease demand for our products, and changes in prevailing interest rates; • the impacts of the COVID-19 pandemic on our operations, including the impacts of our substantial presence in, and reliance upon suppliers based in, China, which has implemented more extreme control measures in response to the pandemic, including a “Zero-COVID” policy that continues to implement lockdowns in response to outbreaks, such as the recent lockdown in Kunshan, China in spring 2022, which impacted certain of our key suppliers on which we depend for our AECs; • our ability to successfully implement our plans to mitigate the impact of potential future supply chain issues by adding geographic diversity to our supply chain and holding increased levels of AEC inventory, which could be ineffective or insufficient or result in inventory write-downs; • geopolitical issues, including developments in the People’s Republic of China, Taiwan or Hong Kong, including the escalation of tensions between the People’s Republic of China and Taiwan, such as recent step up of military exercises around Taiwan by the PRC, all of which could interrupt our supply chain, our operations or our ability to conduct our business; • changes in our management; • lawsuits threatened or filed against us; and • other events or factors, including those resulting from war, incidents of terrorism, or responses to these events. In addition, the market for technology stocks and the stock markets in general have experienced extreme price and volume fluctuations. Stock prices of many technology companies have fluctuated in a manner unrelated or disproportionate to the operating performance of those companies. In the past, shareholders have instituted securities class action litigation following periods of market volatility. If we were to become involved in securities litigation, it could subject us to substantial costs, divert resources and the attention of management from our business and adversely affect our business, financial condition and results of operations. Our failure to timely and effectively implement controls and procedures required by Section 404(a) of the Sarbanes-Oxley Act could have a material adverse effect on our business. We will be required to provide management’s attestation on internal controls. The standards required for a public company under Section 404(a) of the Sarbanes-Oxley Act are significantly more stringent than those required of us as a privately-held company. We may not be able to effectively and timely implement controls and procedures that adequately respond to the increased regulatory compliance and reporting requirements. If we are not able to implement the additional requirements of Section 404(a) in a timely manner or with adequate compliance, we may not be able to assess whether our internal controls over financial reporting are effective, which may subject us to adverse regulatory consequences and could harm investor confidence and the market price of our securities. 29 Item 6. Exhibits. Incorporated by Reference Exhibit Number Exhibit Description Form File No. Exhibit No. Filing Date Provided Herewith 31.1 * Certification of Principal Executive Officer pursuant to Rule 13a-14(a)/15d-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 X 31.2 * Certification of Principal Financial Officer pursuant to Rule 13a-14(a)/15d-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 X 32.1 ** Certification of Principal Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 X 32.2 ** Certification of Principal Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 X 101.INS * Inline XBRL Instance Document (the instance document does not appear in the Interactive Data File because XBRL tags are embedded within the Inline XBRL document) 101.SCH * Inline XBRL Taxonomy Extension Schema Document X 101.CAL * Inline XBRL Taxonomy Extension Calculation Linkbase Document X 101.DEF * Inline XBRL Taxonomy Extension Definition Linkbase Document X 101.LAB * Inline XBRL Taxonomy Extension Label Linkbase Document X 101.PRE * Inline XBRL Taxonomy Extension Presentation Linkbase Document X 104 Cover Page Interactive Data File (embedded within the Inline XBRL document) X *Filed herewith **Furnished herewith 30 SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized. CREDO TECHNOLOGY GROUP HOLDING LTD Date: September 1, 2022 By: /s/ William Brennan Name: William Brennan Title: President and Chief Executive Officer Date: September 1, 2022 By: /s/ Daniel Fleming Name: Daniel Fleming Title: Chief Financial Officer 31