Astera Labs, Inc. has recently released its 10-K report, providing a detailed insight into the company's operations and financial performance. Astera Labs is a San Jose, California-based company that designs, manufactures, and sells semiconductor-based connectivity solutions for cloud and AI infrastructure. The company's intelligent connectivity platform includes semiconductor-based, mixed-signal connectivity products integrated with a matrix of microcontrollers and sensors, along with the COSMOS software suite for connectivity system management and optimization.
In the year ended December 31, 2025, Astera Labs reported a significant increase in revenue, reaching $852.5 million, which marks a 115% surge from the previous year's revenue of $396.3 million. This growth was primarily driven by a substantial increase in overall unit shipments, particularly for the Aries, Scorpio, and Taurus products, as well as higher average selling prices resulting from an increased mix of hardware modules and Scorpio products.
The company's gross margin slightly decreased by 70 basis points to 75.7% in 2025 from 76.4% in 2024. This decline was attributed to the product mix as Astera Labs shipped more hardware modules. Operating expenses increased by $53.1 million or 13% in 2025 compared to 2024, primarily driven by a $75.6 million increase in personnel-related expenses due to a 75% increase in average headcount, a $31.4 million increase in expenses related to research and development initiatives, and other operating costs to support business growth.
Despite the increase in operating expenses, the company reported a net income of $219.1 million for the year ended December 31, 2025, compared to a net loss of $83.4 million in 2024, representing a significant $302.6 million year-over-year increase.
Astera Labs' revenue primarily consists of product sales, with an immaterial portion derived from engineering services. The company recognizes product sales when control transfers to the customer, typically at the time of product shipment from its facilities. Cost of revenue includes the cost of materials, packaging, assembly, shipping, and personnel-related costs, among others.
The company's research and development expenses increased by 51% to $303.9 million in 2025, primarily due to a significant increase in personnel-related costs, including non-cash stock-based compensation expenses resulting from a 97% increase in average headcount. Sales and marketing expenses decreased by 35% to $79.8 million in 2025, mainly due to a decrease in non-cash stock-based compensation expense. General and administrative expenses also decreased by 7% to $88.1 million in 2025, primarily due to a decrease in non-cash stock-based compensation expense.
In addition, Astera Labs reported a 30% increase in interest income, primarily due to higher average balances of short-term investments and cash equivalents. Today the company's shares have moved 4.33% to a price of $182.00. For the full picture, make sure to review Astera Labs's 10-K report.
