Kairos
Stock Research
Boring middle-power suppliers like SmartOptics could do really well over the next three years because hyperscalers have locked up supply chains several levels down, so second- and third-tier vendors serving the non-AI economy benefit disproportionately. With Ciena and others sold out, ISPs rely on SmartOptics to connect data centers and cities. x.comÂ
Networking is the next AI hardware trade after memory, whose share of rack value rose from 15% to 35%. Optics is moving inside the server, as Nvidia's Feynman architecture builds in co-packaged optics and silicon photonics. Scale-across networking could grow 30% a year just linking existing data centers, as inference moves closer to users and training spreads across sites. Supply is tight: Lumentum's CEO said it can meet only 30% of expected 2027 demand and sees optics tighter than memory. x.comÂ
Sivers is less exposed to tighter AI financing because its 700M SEK raise funds a buildout largely reliant on external foundries. It is qualifying with Ayar, Jabil, GlobalFoundries and O-Net for potential tier-one hyperscaler pluggable, CPO and NPO deployments. Higher rates may strain neoclouds needing billions for GPUs, but optical content and aggregate demand should still rise even if hyperscaler AI capex falls, especially as new players start qualification. x.comÂ
AI infrastructure bottlenecks could give eight stocks as much as 18x upside. Nvidia supplies frontier-model GPUs; Broadcom and Marvell supply custom silicon and networking; TSMC makes advanced chips; Micron supplies sold-out HBM; Vertiv provides power and cooling; Palantir monetizes enterprise AI; Alphabet spans TPUs, research, cloud and apps. The list tracks where AI infrastructure spending is flowing. x.com x.comÂ
Scale-up moving to optics adds demand for optical suppliers even if new AI architectures need fewer switches. Bigger data centers and more GPUs add to that need; Jensen Huang expects future optics requirements to be several orders of magnitude above what NVIDIA ships today. This challenges the optics bear case for Lumentum, Coherent, Tower Semiconductor and Credo. x.comÂ
SpaceX's $40B financing for GPU procurement adds another large, funded source of AI-infrastructure demand, with spending flowing into GPUs, memory, networking and optics. At the same time, InP substrates are seriously short, and Morgan Stanley identifies InP, EML and CW lasers as primary bottlenecks; suppliers that secure raw materials should gain pricing power. Any slowdown looks unlikely. x.comÂ
Smartoptics has moved from story stock to execution machine, with Q1 2026 revenue growth accelerating to 59.6%, or $22.9M, from 35% in 2025. Americas sales grew 77.8% as US Tier 2 and 3 providers leave Cisco and Nokia lock-in, and its 400G and 800ZR products are gaining neo-scaler AI clusters. EBITDA margin was 11.7%, or 13.7% excluding production relocation costs, which should fade and push margins toward the 2030 target of 16% faster than expected. Short-term profit-taking de-risks entry. … 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.comÂ
Networking, power and compute look more durable than cyclical memory in the AI buildout. Lumentum's revenue compounded year after year across the 2010s and 2020s, unlike Micron's; AWS revenue also compounded. Lumentum, Nebius, Bloom Energy and Credo should heavily outperform SanDisk and Micron from here, though AI itself remains heavily doubted. x.com x.comÂ
Enterprise data centers and AI racks are competing for limited parts, benefiting data-center OEMs, ODMs, CPU, memory and storage suppliers. Even a modest AI slowdown would not clear the shortages; customers will order ahead to secure allocation. Dell, HPE, Lenovo, Foxconn, Micron, SK hynix, Samsung, SanDisk, AMD and Intel are named beneficiaries. x.comÂ
Optics is the next big opportunity in AI hardware, with a 2-3 year runway of incremental demand as it spreads from scale-out beyond the data center to links between data centers from 2026 and inside servers from 2028. Lumentum is best positioned because current tightness is in lasers rather than transceivers. Coherent has a promising 6-inch expansion, though there is pushback on whether it adds to margins. Applied Optoelectronics expanded capacity most aggressively, so its bet is on execution. … Show more
