NEW YORK, Jan 16, 2026, 3:44 PM ET — Regular session
- Shares of Astera Labs climbed roughly 5% in afternoon trading following RBC’s initiation of coverage with an Outperform rating.
- This call comes as Wall Street wrestles with which chips qualify as “AI winners” following a steep rally.
- All eyes are on the Feb. 10 results, as investors seek insight into demand and what comes next for networking standards.
Astera Labs shares jumped 4.8% to $182.80 in afternoon trading Friday following RBC Capital Markets’ debut coverage. The chip connectivity specialist received an Outperform rating and a $225 price target from RBC. The firm highlighted expected gains from retimer demand and the scaling up of the company’s Scorpio switches as near-term catalysts. 1
The timing is key as Wall Street grows pickier on AI-related semiconductor stocks following a strong rally and increasing concerns over bottlenecks. RBC analyst Srini Pajjuri noted that hyperscale spending should stay robust over the next 18 to 24 months, with hyperscaler balance sheets “not appearing stressed.” Still, he warned of looming constraints and the potential for project delays. 2
Astera, which makes chips and software that handle data movement within large “rack-scale” AI systems—the infrastructure connecting AI accelerators and servers—is set to report its fourth-quarter 2025 results after the market closes Tuesday, Feb. 10. The company will hold a conference call at 4:30 p.m. ET, featuring CEO Jitendra Mohan, President and COO Sanjay Gajendra, and CFO Mike Tate. 3
RBC said the conversation around the stock is moving toward which interconnect technology will dominate next-generation AI clusters. In a separate initiation note, RBC dismissed worries about Ethernet and Nvidia’s NVLink Fusion as “overdone.” It highlighted Astera’s UALink opportunity as “significant,” even if the market eventually backs multiple scale-up standards. 4
This shift follows a boost across the chip sector after Taiwan Semiconductor Manufacturing Co delivered what it described as blockbuster results and outlined plans for increased spending. CEO C.C. Wei admitted the firm felt “very nervous” about matching capacity with demand amid rising AI-driven orders. 5
U.S. semiconductor stocks held steady following TSMC’s upbeat outlook, providing a boost after a volatile start to the year. The Philadelphia SE Semiconductor Index climbed 1.8% on Thursday, led by big hitters like Nvidia and Broadcom. 6
Astera’s shares fluctuated between $177.67 and $187.98 on Friday, closing roughly $8 higher than Thursday. Trading volume hit around 4.2 million shares, market data shows.
RBC’s argument hinges on two key factors: consistent demand for retimers—those chips that tidy up high-speed signals, allowing data to travel farther inside servers—and a 2026 rollout for its Scorpio-X “scale-up” switch, which links multiple AI chips within a cluster. The bank also pointed out the stock’s recent underperformance, as investors fretted over changing networking standards and how quickly major customers are developing their own AI chips.
Yet the standard might fracture, with hyperscalers ready to shift designs fast if costs rise or performance dips. A slowdown in data-center construction or a tougher-than-anticipated AI spending pullback would weigh on suppliers tied to fresh system rollouts.
Feb. 10 is the next key date. Traders will focus on Astera’s guidance and their take on demand for retimers and switches. They’ll also look for clues on how fast UALink and other scale-up methods are moving into actual deployments.
