Three optics stocks have added a combined $120 billion in market value this year as hyperscaler demand for 800G transceivers reshapes the AI infrastructure supply chain.
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Applied Optoelectronics surges 439% in 2026 as optics stocks ride AI wave
Three optics stocks have added a combined $120 billion in market value this year as hyperscaler demand for 800G transceivers reshapes the AI infrastructure supply chain.
Applied Optoelectronics Inc. shares surged 20% to $190 on Monday, extending the fiber-optic component maker's year-to-date gain to 439% as Nvidia Corp.'s Computex 2026 conference reinforced demand for high-speed optical transceivers in AI data centers.
"We completed our first volume shipment of our 800G products to one of our large hyperscale customers in Q1," Chief Executive Officer Thompson Lin said in the company's earnings release.
AAOI reported first-quarter revenue of $151.1 million, up 51% from a year earlier, with datacenter revenue more than doubling to $81.4 million. The company guided second-quarter revenue between $180 million and $198 million. Lumentum Holdings Inc. shares rose 7% to $914, while Coherent Corp. traded flat near $363.
The optics trade reflects a broader shift in AI infrastructure spending from GPUs alone to the networking layer connecting them. Hyperscaler capital expenditure plans from Meta Platforms Inc. and others have topped $700 billion in 2026, with a growing share directed at 400G, 800G and 1.6T transceiver upgrades that directly benefit these three suppliers.
AAOI Leads on Volatility, Lumentum on Scale
Applied Optoelectronics' $15.1 billion market cap makes it the smallest of the three by a wide margin, amplifying both gains and losses. The stock fell 13% last week before Monday's snapback. Insider selling has been heavy — Lin and the chief financial officer sold large blocks at $173.26 and $190.36 on May 19, profit-taking during a historic rally.
Lumentum has actually outperformed AAOI on a one-year basis, with shares up 1,155% versus AAOI's 1,118%. The company's fiscal second-quarter revenue hit $665.5 million, up 66% year over year, with non-GAAP operating margin expanding 1,730 basis points. Chief Executive Officer Michael Hurlston flagged an optical circuit switch backlog above $400 million and a multi-hundred-million-dollar co-packaged optics order deliverable in the first half of calendar 2027. Hurlston disposed of 5,438 shares at $970.70 on May 15.
Coherent's Steadier Path
Coherent, the largest of the three with a more diversified revenue base, reported fiscal third-quarter revenue of $1.81 billion, up 21% year over year. Datacenter and communications now represent 75% of the revenue mix. Chief Executive Officer Jim Anderson highlighted Nvidia's $2 billion investment in the company, saying "as AI datacenter infrastructure continues to scale, we are rapidly expanding capacity to meet demand." Coherent shares are up 94% year to date and recently joined the S&P 500.
All three stocks trade at premium valuations after extraordinary runs, and insider selling across the group is a flag that prudent investors should weigh. The next catalyst is the round of hyperscaler capex commentary and 800G and 1.6T transceiver ramp updates from each company. AAOI's smaller size gives it more torque in either direction, while Coherent's scale and Nvidia partnership provide ballast. Lumentum's optical circuit switch backlog offers a visibility advantage through 2027.
This article is for informational purposes only and does not constitute investment advice.
