Finn Stockinger
Equity Analyst & Investor, Technology Research
Himax is a core bottleneck in TSMC's COUPE co-packaged optics ecosystem, with first commercial CPO shipments due in H2 2026 as a short validation horizon. FOCI assembles fiber units but cannot ship without Himax's optical substrates. Himax owns wafer-level optics lines already paid for by a decade of AR spending, so even small optics sales would lift profits sharply and force a re-rating. Visera is no drop-in substitute, as Himax's polymer optics handle CPO power levels. x.com x.comÂ
Himax is the real gatekeeper of co-packaged optics, which needs micro-lenses to bend laser light 90 degrees into fiber. Himax prints these wafer-level lenses on its own lines and is sole-source supplier for TSMC's COUPE platform, while FOCI is mostly an integrator relying on Himax substrates; Himax also owns over 5% of FOCI. With cleanrooms ready and capex paid, AI optics from H2 2026 shipments should carry 70-80% margins, forcing a re-rating of a $3.2B firm seen as a display maker. x.comÂ
Himax offers high-upside optionality on microLED-based co-packaged optics, alongside its micro-lens arrays that route light into fiber. The microLED approach uses hundreds or thousands of simple low-speed lanes, removing high-speed SerDes, DSP and the InP laser and cutting energy below 1 pJ/bit. Himax's display-driver know-how maps unusually well onto it. It is pre-revenue, short-reach only and debated, but at ~10x EV/gross profit, current levels look reasonable for those who see a path for CPO. … Show more
Himax's microlens monopoly is real but narrower than the market thinks. As the Hunterbrook and Citrini report claimed, and Tianfeng Securities confirms, it is the sole microlens supplier for TSMC's COUPE Gen 1-2. That is not a monopoly on Nvidia's co-packaged optics: Himax is not among Nvidia's 11 official CPO partners, TFC, Corning and Orbray build CPO-grade fiber array units without it, and 80% of revenue is still display drivers. That leaves it a small, low-conviction long. x.com x.comÂ
TSMC may lose pricing power as performance gains shift from shrinking transistors to stacking, interconnects and optics, while logic folding could make older processes competitive. Despite strong leading-edge demand, investors may overestimate the profit share its node leadership can retain. Its cautious expansion and past reluctance toward advanced packaging suggest a risk-averse culture that protects returns but could leave it late to disruptive technologies and key customers. x.comÂ
Himax adds multiple entry points into AR and MR glasses on top of co-packaged optics, through WiseEye, LCoS and other wafer-level optics components. Foci has much higher CPO revenue exposure because it sells the entire finished component to TSMC, including the module connecting to the external cable. @zephyr_z9 notes an Apple AR glasses deal pushed Himax up further. x.comÂ
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.comÂ
Himax's Q1 2026 update checks off the Apple and NVIDIA opportunities. Per @wallstengine, WiseEye was adopted by a leading smart-glasses brand with mass production later this year, first-generation co-packaged optics ship in small quantities in 2H26, and second-generation CPO is nearing customer validation for AI data centers. Revenue of $199.0M and EPS beat estimates, and Q2 guidance for 10-13% sequential revenue growth and about 32% gross margin topped consensus. x.comÂ
Interconnect, not compute, is now the binding constraint on AI clusters. Copper, pluggable optics and CPO will coexist for years, so the strongest names span both paths or own the tightest bottleneck. Top five: Credo, the fastest-growing full stack; Applied Optoelectronics, the 800G/1.6T ramp; Marvell, broadest but richly priced; Lumentum, the laser chokepoint; Tower, the foundry bet. Coherent, Amphenol, Fabrinet, GlobalFoundries, TSMC and Broadcom also gain. Astera Labs is pricier and narrower. … Show more
Himax's LCoS microdisplay leads on the size, weight and power that all-day AR glasses need, and possible links to Apple and Google aren't priced. It will show a 0.09cc, 0.2g, 350,000-nit spec at SID Display Week on May 6. Apple's incoming CEO John Ternus, a hardware engineer, may push sub-50g glasses, and a @hntrbrkmedia and @citrini report pointed to an Apple link. Google sold its waveguide lab to Vuzix, whose reference design uses Himax LCoS. None is confirmed, and Himax lags on consumer wins. … Show more
Xintec offers TSMC's co-packaged optics testing bottleneck at a huge discount. TSMC's COUPE volume production starts this year with wafer-level testing flagged as one of three critical scaling challenges, and TSMC plans to pursue CPO with its subsidiary Xintec, which is ramping wafer testing capacity for second-half 2026 growth. 90% trial yields on 310mm pilot lines suggest technical risk is falling faster than its roughly $2.18B market cap reflects. 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
