Astera Labs, Inc. (ALAB)

Price$363.46Cached quoteAs of 2026-09-23 11:41 UTC

AI: Overvalued

Price checkThe market price already assumes years of exceptional growth and strong profits.

At the observed market value of roughly $48 billion, Astera trades near 40 times trailing twelve-month revenue of about $1.20 billion and roughly 130 times trailing net income of about $369 million. Even using management's strong third-quarter revenue midpoint and simply annualizing it produces a run-rate sales multiple near 22 times. The valuation can work if Scorpio and other products keep expanding rapidly for years, but it leaves little protection if growth normalizes. That makes the shares overvalued for a value-oriented investor.

Big pictureRevenue and cash generation are surging, but the present pace is unusually demanding.

Revenue rose from $396 million in 2024 to $853 million in 2025, while operating income swung from a $116 million loss to a $173 million profit. The latest four quarters produced about $1.20 billion of revenue, $336 million of operating cash flow and roughly $277 million of free cash flow, meaning cash left after capital spending. Second-quarter 2026 revenue grew 104% year over year, and management expects roughly 40% sequential growth at the third-quarter midpoint. These are extraordinary gains, but semiconductor demand tied to major artificial-intelligence infrastructure builds can arrive in concentrated waves.

Business strengthAstera combines rapid growth, high margins, and a balance sheet with substantial financial cushioning.

Second-quarter gross margin was 73.3%, while operating income reached $89 million on $392 million of revenue, showing that rising sales are producing real accounting profits rather than only adjusted earnings. The supplied filings show $1.65 billion of current assets against just $164 million of current liabilities at June 2026, with no debt amount reported. That provides considerable downside resilience. The main capital-allocation concern is dilution: shares outstanding increased from about 162 million at year-end 2024 to 173.5 million, while trailing stock compensation approached $195 million and recent buybacks were negligible.

What could change the storyScorpio's ramp could justify more value, while slower deployments would expose the rich valuation.

The strongest bull case is Scorpio becoming Astera's largest product family during the third quarter while Aries, Taurus, optical connectivity and custom products broaden the revenue base. Management's $540 million to $560 million third-quarter revenue outlook would be a major step upward. The bear case is that today's valuation effectively requires that surge to continue well beyond one quarter while margins stay unusually high. Evidence supporting the premium would be sustained growth after Scorpio's initial ramp with stable cash margins and slower share dilution; a meaningful slowdown would make today's multiple difficult to defend.

AI: News

Record second quarterAstera crushed recent growth expectations and forecast another large jump as Scorpio production accelerates.

On August 4, Astera reported $392.4 million of quarterly revenue, up 27% from the prior quarter and 104% from a year earlier. It guided third-quarter revenue to $540 million to $560 million as Scorpio X-Series switches ramp. The shares then fell about 12% on August 5 despite the strong report. Commentary attributed the reversal partly to profit-taking after a large pre-earnings run, so the price move should not be treated as proof that investors rejected the business outlook.

Taurus product expansionNew high-speed connectivity products widen Astera's opportunity beyond its rapidly growing switch business.

On July 21, Astera introduced 3.2-terabit Taurus Smart Retimers and Smart Redrivers aimed at 200-gigabit-per-lane Ethernet and other artificial-intelligence connections. Their standardized footprint is designed to let customers switch between longer-reach and lower-power parts without redesigning boards. This matters because it can deepen Astera's role inside increasingly dense computing systems and diversify growth beyond Scorpio. Astera shares were reported up about 2.6% that afternoon, although a single-day move cannot establish that the announcement alone caused the gain.

Nasdaq-100 additionIndex inclusion increased Astera's visibility and created automatic demand from funds tracking the benchmark.

Nasdaq announced on June 11 that Astera Labs would join the Nasdaq-100 effective before trading on June 22. Inclusion matters because funds designed to follow the index generally must own its members, creating a mechanical source of demand independent of changes in the company's underlying earnings. Barron's reported Astera shares up about 4.3% in premarket trading following the announcement. That reaction is consistent with index-related buying expectations, although broader market forces can also influence short-term prices.

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Revenue

2022

2023

2024

2025

Net income

2022

2023

2024

2025

Free cash flow

2022

2023

2024

2025

Total cash / debt

CashTotal debt

2022

2023

2024

2025

Financial statements

	2025	2024	2023	2022
Revenue	$852.5M	$396.3M	$115.8M	$79.9M
Gross profit	$645.3M	$302.7M	$79.8M	$58.7M
Gross margin	75.69%	76.38%	68.94%	73.47%
Research & development	$304.0M	$200.8M	$73.4M	$73.7M
Operating expenses	$471.8M	$418.8M	$109.3M	$118.9M
Operating income	$173.4M	−$116.1M	−$29.5M	−$60.2M
Operating margin	20.34%	−29.29%	−25.47%	−75.36%
EBITDA	$180.3M	−$112.9M	−$27.7M	−$59.4M
EBITDA margin	21.14%	−28.49%	−23.94%	−74.35%
Net income	$219.1M	−$83.4M	−$26.3M	−$58.3M
Net profit margin	25.70%	−21.05%	−22.68%	−73.05%
Basic EPSper basic share	$1.32	-$0.64	-$0.71	-$1.71
Diluted EPSper diluted share	$1.22	-$0.64	-$0.71	-$1.71

Review official source filings ↗

Owners

Reported shareholders

Reference date Jun 30, 2026

14.32%of listed shares

FMR LLC24.85M shares · Jun 30, 2026

View holders

Top 20 reported holders of ALAB
Holder	% owned
FMR LLC	14.32%24.85M shares
BlackRock, Inc.	7.89%13.68M shares
SUTTER HILL VENTURES	≈6.44%11.17M shares
Mohan Jitendra	≈4.75%8.24M shares
VANGUARD PORTFOLIO MANAGEMENT LLC	4.55%7.89M shares
Gajendra Sanjay	≈4.46%7.73M shares
VANGUARD CAPITAL MANAGEMENT LLC	3.88%6.73M shares
Invesco Ltd.	2.83%4.91M shares
STATE STREET CORP	2.12%3.68M shares
GEODE CAPITAL MANAGEMENT, LLC	1.61%2.8M shares
PRICE T ROWE ASSOCIATES INC /MD/	1.39%2.41M shares
VAN ECK ASSOCIATES CORP	1.29%2.24M shares
BANK OF AMERICA CORP /DE/	1.27%2.2M shares
JPMORGAN CHASE & CO	1.02%1.78M shares
ALBA MANUEL	≈1.01%1.75M shares
MORGAN STANLEY	0.97%1.69M shares
Amundi	0.92%1.59M shares
Whale Rock Capital Management LLC	0.90%1.57M shares
NORGES BANK	0.83%1.43M shares
CITIGROUP INC	0.78%1.35M shares

Percentages use 173.49M shares of this listed class outstanding on Jun 30, 2026. ≈ compares the latest reported holding with a share total from a different date; it is not a confirmed current stake.

Gray completes the 100% scale. Reported positions may overlap; holders have different reporting dates.

Source: SEC Form 13F ↗Updated Sep 29, 2026 · Quarterly data

Insider buys & sells

Jul 1, 2024–Jun 30, 2026

Buys0$0.00 disclosed value

Sells (SEC code S)852$1.38B disclosed value

Transaction	Insider	Type	Shares	Price	Value	Owned after
Jun 24, 2026Form 4 · 10b5-1	Mayer BethanyDirector	SellCommon Stock	29	$399.96	$11.6K	5.5K
Jun 24, 2026Form 4 · 10b5-1	Mayer BethanyDirector	SellCommon Stock	165	$398.32	$65.7K	5.6K
Jun 24, 2026Form 4 · 10b5-1	Mayer BethanyDirector	SellCommon Stock	146	$396.49	$57.9K	5.7K
Jun 24, 2026Form 4 · 10b5-1	Mayer BethanyDirector	SellCommon Stock	54	$393.86	$21.3K	5.9K
Jun 24, 2026Form 4 · 10b5-1	Mayer BethanyDirector	SellCommon Stock	193	$392.67	$75.8K	5.9K

Review ownership filings at SEC.gov ↗

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Astera Labs, Inc. (ALAB)

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