Introduction
In this article, I’ll cover one of the core stocks to play the optical networking boom.
This company benefits from the industry’s growth regardless of which laser maker wins the qualification race.
More importantly, its silicon photonics expansion is built on a solid technological and financial foundation, allowing it to multiply capacity over the next few years without dilution, with customer prepayments covering a significant portion of the capex.
Its customers include Coherent, Marvell, Semtech, Broadcom, MACOM, Lightmatter and InnoLight, with Nvidia among the end users.
AI stocks are enduring a massive drawdown, and optics names aren’t doing much better.
This stock is down 51% from its May high, even as fundamentals continue improving and the long-term thesis remains as strong as ever.
In this article, I’ll explore whether there’s an investment opportunity in one of the clearest beneficiaries of the optical networking boom in AI clusters, a technological trend that will develop into a supercycle regardless of the broader macroeconomic environment.