quote: Rosenblatt lasers/opticals takeaways: "Demand for CPO/NPO has increased, and deployment timelines have not been pushed out." "Spot prices for 100G/200G EML and CW lasers have recently surged by HSD to LDD percentages on a sequential quarterly basis." "While Chinese-made lasers for 1.6T silicon photonics transceivers may become more competitive in the next 18 months, highpower and ULH power lasers for CPO, where the U.S. manufacturer's moat is deepest, are where the puck is headed" $AAOI: "On LTAs, AAOI is selectively holding off on signing, as customers want volume flexibility and price locks while AAOI wants pricing upside as shortages deepen, with leverage expected to shift further toward AAOI." "800G targeted up ~5x Q/Q in Q3; capacity sold out through at least H2 2027: Capacity is fully sold out through at least H2 2027, with new Hyper Scale inquiries being turned away." "1.6T ramping on the $200M order. Roughly $70- 80M of the announced $200M 1.6T order is expected in Q4, with the remainder into H1 2027, additional 1.6T customer qualifications underway, and future orders expected as a continuous stream, not all of which will be press-released" "Management pointed out that industry wafer capacity is nowhere near sufficient and investments are accelerating across all players;" "Management expects CPO to come before NPO/XPO integration, with Nvidia targeting CPO by the end of this year, and CW lasers are the primary focus as EML demand declines in relative terms" $LITE: "Chinese competition discounted for 2+ years. Substrate supply is secured via a 7-year LTA with a Japanese vendor and an agreement with AXT, with geographic fab diversity across the US, Japan, and Europe reducing China export control risk." "OCS revenue is expected to double Q/Q for the next several quarters, with past stumbles attributed to manufacturing and engineering ramp issues rather than design flaws. 1.6T transceivers are shipping to two major Hyper Scalers, with the first-to-market advantage driving better pricing and share, and management targets keeping transceivers at ~25% of the revenue mix while scaling higher-margin components faster." $COHR: "InP capacity doubled over the last 12 months and is expected to more than double again over the next 12 months, with 80% more lasers produced last quarter Y/Y" "More than 50% of shipped transceivers came off six-inch lines last quarter, with the mix expected to reach 75% six-inch by the end of next calendar year." "Coherent is shipping into every major Hyper Scaler OCS design currently in deployment, the liquid crystal component production bottleneck is resolved, and applications are expanding beyond scale out into scale up, including GPU sparing, dynamic compute allocation, and workload distribution across clusters" "Gross margin has expanded in 8 of the last 9 quarters, up more than 660 bps cumulatively, with Data Center transceivers (the fastest-growing segment but lowest margin) the primary headwind." | Rosenblatt InP lasers checks: According to our checks, NVIDIA, which is the driving force behind scale up CPO, asked the supply chain to increase InP laser capacity by ~20x from 2025-2030. The vendors appear to have taken a more conservative stance, agreeing to an ~12x increase ( $AAOI / $LITE etc)

quote: Rosenblatt lasers/opticals takeaways: "Demand for CPO/NPO has increased, and deployment timelines have not been pushed out." "Spot prices for 100G/200G EML and CW lasers have recently surged by HSD to LDD percentages on a sequential quarterly basis." "While Chinese-made lasers for 1.6T silicon photonics transceivers may become more competitive in the next 18 months, highpower and ULH power lasers for CPO, where the U.S. manufacturer's moat is deepest, are where the puck is headed" $AAOI: "On LTAs, AAOI is selectively holding off on signing, as customers want volume flexibility and price locks while AAOI wants pricing upside as shortages deepen, with leverage expected to shift further toward AAOI." "800G targeted up ~5x Q/Q in Q3; capacity sold out through at least H2 2027: Capacity is fully sold out through at least H2 2027, with new Hyper Scale inquiries being turned away." "1.6T ramping on the $200M order. Roughly $70- 80M of the announced $200M 1.6T order is expected in Q4, with the remainder into H1 2027, additional 1.6T customer qualifications underway, and future orders expected as a continuous stream, not all of which will be press-released" "Management pointed out that industry wafer capacity is nowhere near sufficient and investments are accelerating across all players;" "Management expects CPO to come before NPO/XPO integration, with Nvidia targeting CPO by the end of this year, and CW lasers are the primary focus as EML demand declines in relative terms" $LITE: "Chinese competition discounted for 2+ years. Substrate supply is secured via a 7-year LTA with a Japanese vendor and an agreement with AXT, with geographic fab diversity across the US, Japan, and Europe reducing China export control risk." "OCS revenue is expected to double Q/Q for the next several quarters, with past stumbles attributed to manufacturing and engineering ramp issues rather than design flaws. 1.6T transceivers are shipping to two major Hyper Scalers, with the first-to-market advantage driving better pricing and share, and management targets keeping transceivers at ~25% of the revenue mix while scaling higher-margin components faster." $COHR: "InP capacity doubled over the last 12 months and is expected to more than double again over the next 12 months, with 80% more lasers produced last quarter Y/Y" "More than 50% of shipped transceivers came off six-inch lines last quarter, with the mix expected to reach 75% six-inch by the end of next calendar year." "Coherent is shipping into every major Hyper Scaler OCS design currently in deployment, the liquid crystal component production bottleneck is resolved, and applications are expanding beyond scale out into scale up, including GPU sparing, dynamic compute allocation, and workload distribution across clusters" "Gross margin has expanded in 8 of the last 9 quarters, up more than 660 bps cumulatively, with Data Center transceivers (the fastest-growing segment but lowest margin) the primary headwind." | Rosenblatt InP lasers checks: According to our checks, NVIDIA, which is the driving force behind scale up CPO, asked the supply chain to increase InP laser capacity by ~20x from 2025-2030. The vendors appear to have taken a more conservative stance, agreeing to an ~12x increase ( $AAOI / $LITE etc)

Source:https://x.com/sean_________/status/2090055937599926710