Rising 1.6T switching demand favors optical suppliers, though their execution risks vary. Bank of America says the market could grow ~101% annually through 2030. Marvell's leading DSPs and Lumentum's supply-short 200G EML lasers are lowest risk; Applied Optoelectronics' capacity expansion and Fabrinet's customer concentration make them medium risk. Aeluma remains pre-commercial, while Lightwave Logic's polymer modulators are a high-risk moonshot despite its TSM partnership. 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 

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

Lumentum, the largest indium phosphide laser maker and supplier of the ultra-high-power laser in NVIDIA's Spectrum-X CPO switch, has a lot to gain from the silicon photonics roadmap. Its indium phosphide is sold out for years, which explains why its SEMICON Taiwan talk promoted gallium arsenide VCSELs for scale-up, rating them strong on 5 of 7 axes. VCSELs are its only incremental revenue in that period, even though they could displace its InP business. x.com  x.com 

Photonics suppliers ride the same curves Marvell just laid out through 2030. Marvell targets $70-90B of fiscal 2031 revenue from $8.2B last year, with a TAM 4x its last investor day and interconnect the biggest segment at about $37.5B. Supply is tight: Lumentum's CEO says it can meet only 30% of customer demand next year, and Coherent is booked through 2027. @AsymmetricBets_ applied Marvell's model to Lumentum, Coherent, Applied Optoelectronics, Ciena, Tower Semiconductor and Astera Labs. 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 

AI's power problem is really a connectivity problem, and Marvell, Astera Labs, Fabric AI and Kopin are working on the fix. A 100,000-GPU data center needs a million or more copper interconnects; switching to MicroLED optical links would use about 1/30 of the power, under 1 pJ/bit versus up to 5 for copper and 15 for laser. x.com  x.com 

Credo's first 1.6T active linear cable uses micro-VCSEL instead of microLED, putting the preferred optical technology into that product. Credo has finally acknowledged the pivot, and micro-VCSEL remains the much-favored approach. x.com  x.com  x.com 

The LYTE ETF offers pure-play exposure to global photonics and optics leaders, with Coherent and Lumentum as its top holdings. Nvidia CEO Jensen Huang has said the world needs substantially more silicon photonics capacity than it has today, explaining Nvidia's $4B investment in Lumentum and Coherent. x.com  x.com 

Lumentum stands to gain as the shift from copper to light inside AI data centers accelerates. Co-packaged optics is now in mass production, per TrendForce, with Nvidia shipping Spectrum-X CPO switches. Near-packaged optics is catching on fast; Lumentum CEO Michael Hurlston says its demand looks bigger than CPO's and came sooner, now late 2027 or early 2028. He sees about $40 a share of fiscal 2028 earnings power, above Street estimates, with none of CPO or NPO in the numbers yet. x.com