Marvell risks paying a peak-scarcity price for Lumentum if optical supply catches up by 2028-30. The proposed ~$99B deal values Lumentum at roughly 20x guided annualized revenue and 58x estimated after-tax operating income, while Lumentum, Coherent and Chinese suppliers are adding laser capacity. The DSP-and-laser combination has strategic logic, but durable scarcity economics and Nvidia's response remain uncertain. x.com 

Coherent's booked InP laser capacity gives it a potential path into Nvidia's CPO expansion. Nvidia wants optical-engine capacity up 15x by mid-2027 and holds laser purchase commitments and capacity rights from its $2B Coherent investment. Coherent says fiscal 2027 is essentially booked and customers are reserving into 2028, but most near-term orders are for pluggables and other products; scale-up CPO revenue starts only in H2 2027. Neither company has sized Nvidia's rights. x.com 

Lumentum and Coherent face a threat from microLED optics, which could replace laser optics with 20x less power and no temperature sensitivity by late 2027. The use case is short-reach, high-volume links under 30 meters. The copper versus optics debate is a distraction, since every AI cluster needs both and Credo now does both while Applied Optoelectronics handles long-haul; the bigger question is what microLED does to laser makers. x.com  x.com 

Coherent is a structural bet on the data center shift from chips to connectivity, where optical components are now the bottleneck. Hyperscaler capex is forecast up 36% in 2026, and AI infrastructure spending is strategic necessity that won't be deferred in a recession. Nvidia's $2 billion investment locks in optical supply and gives Coherent revenue visibility through the decade. Its S&P 500 inclusion comes while the market prices a recession, setting up a repricing over the next 12 months. … Show more

AI data-center spending flows beyond GPUs and operators into networking, optics, power and cooling. Nvidia, AMD, Broadcom and Marvell supply chips; Arista, Nokia and Credo connectivity; Applied Optoelectronics and Lumentum optics; Vistra, Constellation and Bloom power; Vertiv and Modine cooling. Meta's $140B spending this year illustrates the scale, per a commenter with whom the point is agreed. x.com  x.com 

Coherent now has credible exposure to almost every optical architecture hyperscalers are exploring, and its Nvidia deal materially de-risks that roadmap. Nvidia's nonexclusive pact adds a multibillion-dollar purchase commitment, a $2B equity investment and access to five CPO product families. First CPO/NPO revenue targeted for H2 2026 matches Nvidia's timing. Data center and communications are already 72% of revenue. Qualification, standards, concentration and margins remain unsettled. x.com 

Coherent's pivot to AI optics is paying off as copper gives way to optical links inside large AI clusters. Quarterly revenue topped $2 billion for the first time, up 42%, with datacenter and communications up 59% to 79% of sales. Multi-year contracts with AI leaders including Nvidia extend order visibility into 2028. It launched its PhotonLink interconnect platform at ECOC 2026, and its indium phosphide, VCSEL and 6-inch wafer strengths give it a moat in 800G and 1.6T transceivers. x.com 

Corning's optics business looks ready for a comeback as its fiber and high-density optical connectivity move data across massive AI GPU clusters. Optical sales rose 32% year over year to $2.07 billion, EPS is expected to more than triple by 2028, and the business is backed by major AI infrastructure deals with NVIDIA, Meta and Amazon. x.com 

AI networking and optics growth underpins an extremely bullish outlook for Lumentum, Coherent, Marvell, Credo, Astera Labs and Broadcom. BofA estimates AI networking will grow from $95.6B in 2026 to $394B in 2030, with optical reaching $111B and co-packaged and near-packaged optics reaching $14.1B and $10.7B. Photonics is one of the most interesting investment themes for 2027 onward, though it is a complex market with many players. x.com 

Optics and photonics should be among AI's biggest winners as faster GPU networks need optical connections that suppliers cannot expand quickly enough. Lumentum says some components are sold out through early 2029; Sivers is investing $30M to target more than 100M lasers a year, with operations expected in Q4 2027. Potential US restrictions on Chinese transceivers could reshape supply in 2027. Applied Optoelectronics and Sivers are the favorites. x.com  x.com