Tower Semiconductor's silicon photonics demand is accelerating earnings, supporting a Buy with a $260 target, or 26x 2027E EPS. 2Q26 revenue rose 24% to $460M and operating profit 125%, with an EPS beat on utilization and mix. 3Q26 guidance is a record $520M, up 31% YoY. Hyperscalers have locked in $1.3B of 2027 SiPho revenue, 2028 wafer commitments should exceed 2027, and new customers are qualifying. 2026/27 EPS estimates rise to $4.5 and $10, with NPO volume ramping in 2H27. x.com 

Tower Semiconductor's roughly $3 billion silicon photonics and silicon germanium expansion in Japan confirms real demand on the scarce foundry floor of the optical buildout. Japan is backing about $1 billion in grants, and Tower raised its 2028 model to $3.6 billion of revenue and $1.2 billion of net profit, versus $1.6 billion and $245 million today. Few merchant fabs can make co-packaged optics chips at 300mm, and Morgan Stanley put Tower in that supply chain beside TSMC and GlobalFoundries. … Show more

Tower Semiconductor's good news looks mostly priced in at a $27 billion market cap, with upside hinging on capacity timing. A reported BofA Buy call with a $367 target rests on Tower's silicon photonics lead, and the numbers have substance: SiPho's run rate rose from $180 million to $680 million in a year, backed by a $1.3 billion 2027 contract. But its Arai, Japan fab reaches full production only in Q4 2027, a delay would push back the 2028 model, and $367 assumes those targets are hit on time. … Show more

Tower Semiconductor is becoming to photonics what TSMC is to GPUs: a foundry building the next AI stack. It fabricates silicon photonics chips that combine lasers, modulators and detectors on one platform, and is integrating Lightwave Logic into that platform right after massive AI optical spending. As AI networks scale to 800G and 1.6T, photonics becomes the next bottleneck, with limited supply and exploding demand. x.com 

Tower Semiconductor is building the foundry that silicon photonics needs, alongside its power management business, and its chart is flashing a blue buy signal again. x.com 

Tower Semiconductor probably has little upside left, trading at 43x the $500M net profit it projects once its foundry buildout is complete and running at 85% utilization. By contrast, TSMC trades at 24x 2026 earnings. x.com 

Tower Semiconductor's stronger-than-expected capacity expansion lets it fill more optical-chip orders itself, reducing customers' incentive to move to foundries they regard as technologically weaker. Its hybrid bonding packs dense connections between photonic chips and their driver electronics, an advantage viewed as effectively unmatched among Western suppliers. Tower remains one of the highest-conviction holdings despite the portfolio trim. x.com 

Tower Semiconductor's silicon photonics is shifting from future optionality to a production ramp, making it a merchant SiPho foundry tied to AI optical connectivity rather than a legacy analog foundry. With NewPhotonics, it began high-volume shipments of laser-integrated optical engines on its PH18DA platform for 800G and 1.6T, putting lasers, amplifiers, modulators and detectors on one chip to cut assembly complexity. A 6.4T near-packaged optics chipset targets volume shipments in 1H27. x.com 

Tower Semiconductor is a silicon photonics foundry behind the AI optical stack, and the market will price it for where its revenue mix is going. Its silicon photonics revenue doubled in 2025 on hyperscaler demand, more than 70% of capacity is booked through 2028, and it is partnered with Nvidia on next-gen optical modules. As @joedab12 noted, it is not a pure play yet: silicon photonics is still a minority of revenue, but the fastest-growing piece. x.com  x.com 

Tower Semiconductor is the only foundry besides TSMC with production-ready silicon photonics at scale. Every 1.6T optical module going into AI data centers needs Tower's wafers, and 70% of its capacity through 2028 is already secured. x.com