Rand Group
Crypto Trader & Investor, Building RR2 Capital, Early-Stage Investing
Jabil's photonics business is underpriced, as the market values it as a contract manufacturer shipping 1.6T transceivers while its photonics revenue tells a different story. Per @aleabitoreddit, Jabil looks compelling at $38B, with massive supply chains in place, Intel's former pluggable lines and a validated hyperscaler supply chain, a more scalable model than building laser fabs. With Sivers as the bottleneck into H1 2027, the setup looks very interesting. 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
Jabil looks like a compelling long at $38B because markets have not priced in its 1.6T LRO pluggable transceiver business. With Sivers as the H1 2027 bottleneck, the question is how much it can make, not whether demand exists. It has massive supply chains, took over Intel's pluggable lines and looks more scalable than Applied Optoelectronics' ATM-funded laser fabs. Recognition likely comes in H1 2027; a ~40% rerating seems plausible, though at its size tripling is less likely. x.com x.comÂ
United Microelectronics, Jabil and NGK Insulators are better bought back after a historic bear market expected next year than held now, despite a strengthening HyperLight thin-film lithium niobate thesis. Telecom validation widens the market: Ciena is qualifying TFLN as a second source in its shipping WaveLogic 6 Extreme platform, Cisco holds patents bonding lithium niobate onto silicon photonics, and Nokia has worked with HyperLight since 2018. They could be had at half price at the lows. x.com … Show more
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.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
China's already-shipping CW lasers make Sivers' Chinese pluggable pipeline depend on price and qualification speed. Yuanjie says its 70/100mW chips, the classes Sivers lists, are in continuous large-volume delivery. It guides Q3 revenue up 265-293% and expects new capacity from end-2026 to early 2027, before Sivers' Q4 2027 Glasgow expansion. Yuanjie's 120/300/400mW parts remain in customer validation; Western hyperscaler qualification is probably where Sivers still has time. x.com x.com x.com … Show more
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.comÂ
Even half of a rumored jump in Applied Optoelectronics' transceiver shipments would be well above what is priced in. A Substack claims 800G shipments will rise from about 600,000-700,000 to about 5 million next year, plus about 100,000 1.6T units a month; the rumor is low-confidence. x.comÂ
Sivers Semiconductors' LiDAR design win is closer to generating revenue now that its customer has placed initial production orders. Shipments begin in Q4 2026; automotive and industrial programs target 2027 production. Sivers estimates $53M-$138M in lifetime revenue potential, not firm backlog; the initial order value is undisclosed and the program was announced in March. Repeat orders and shipment growth must convert potential into revenue; the market also wants profitability. x.com x.comÂ
Optical transceiver demand exceeds supply, and 1.6T lifts revenue per module for suppliers able to qualify capacity. Applied Optoelectronics raised at least $1.62B through 2026 ATMs; its last reported monthly capacity was 200,000 modules versus a year-end target above 650,000. Credo expects over $600M in FY2027 revenue across optical DSPs, PICs and modules, not modules alone. Shipments, yields and margins must prove out. Lumentum and Coherent already price in much expected growth. x.comÂ
