Checked overnight market. Damn lol.
Guess I need to stay up another hr to push leverage in premarket.
Prob size up WOLF and AAOI. Re-enter Enphase. Maybe re-enter NVTS.
Concerned dumb ppl falling for Navitas CEO TAM bullshit. Their SiC is garbage. Only GaN portfolio of value.
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Morgan Stanley says SemiAnalysis' report on Nvidia's planned large-scale shipments of 800VDC power architecture being pushed back to 2028 is contrary to their own supply chain checks at Computex.
"Nvidia at GTC Taipei Indicated 800 VDC developments are ongoing with 800 VDC power rack being ready for mass production in 3Q26. +-400 VDC development has been redirected to 800 VDC focus across various hyperscalers."
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DC POWER UPGRADE FUD: Market weakness begets fear and shortens investor duration, hence tendency to question pie in the sky technology stories. Power transition to 800V seeing some negative press and power names e.g., DELTA $2308; ROHM $6963; $485A; passives in general -- impacted
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anyone looking at Epiworld (listed in Hong Kong, $2726) for the power semi / 800V DC theme? IPOed late March before the power semi excitement. chart looks pretty good. same price since its 35% first day pop.
when i saw the IPO in March i immediately passed on it as soon as i saw the letters EV in its prospectus. then i read irrational analysis, Vik and Semianalysis posts on the 800V DC transition in data centers and rmbed Epiworld
it's a pure play SiC epitaxy foundry. Infineon is a customer. Epiworld was the first in the world to scale 8 inch SiC epitaxial wafers. it raised $200 million from the IPO to expand that 8 inch SiC epitaxial wafer capacity over the next 5 years (usually a good sign if a company raises money primarily to expand capacity. they saw demand coming). it also has the world’s first 12 inch SiC epitaxial wafer
fun fact: it's backed by Huawei via its Hubble Tech venture arm
thoughts?
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this random Chinese landscape design firm called Hui Lyu Ecological Technology Groups ($001267) acquired optical transceiver maker Tri-light Wuhan Electronics Technology in 2024 for $29 million. since then, Hui Lyu's shares are up 1,600% and the landscape design firm's founder became a billionaire lol
article says Coherent is a customer of Tri-light
Tri-light agreed to be acquired by the landscape design firm back then cause of capital needed for production expansion
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Huber+Suhner jumped today after Lumentum said "we are experiencing considerable tightness in" OCS.
Lumentum's MEMS OCS is the best but it doesn't have the capacity to meet all the growing demand, giving opportunities for others. We've seen this in chip manufacturing (TSMC is the best but no capacity so Samsung and Intel getting another look) and AI chips (Nvidia best but you need to get in a very long line, so rather have AMD than no AI chips)
Huber+Suhner's piezo OCS has its own advantages of course (very low insertion loss)
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@jukan05 Rubin delay.
yesterday Huber+Suhner announced that Microsoft is going to deploy its Hollow-Core Fiber, which allows data to travel abt 50% faster (it's air filled instead of solid glass)
since you're buying HCF from Huber+Suhner might as well try their OCS too (Microsoft is rumored to be Huber+Suhner's mystery OCS hyperscaler customer)
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best report i've seen on Huber+Suhner, an underrated Swiss company with a growing optics business.
H+S has multi-year orders for its OCS from a global hyperscaler (Google?)
opened a huge production facility in Poland last year with plans to increase capacity at least 5x over two years
UBS says that OCS order alone is worth around 10% of its total revenue
Chinese hyperscalers might also use H+S's OCS cause the company has no US-origin content or manufacturing
Fabian is one of my fav semis/optics writers. in-depth and provides all citations. his reports on testing and measurement companies (eg keysight, viavi) are the best on substack
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Nice chart of CPO test ecosystem here:
"Building a Mass Production System for AI Computing Optical Interconnect Technology with High Reliability and Million-Level Delivery Capability" - Speaker: Dr. Sheng-Yu Chen, Chief Technology Officer, Enlight Technology
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i dont get why some investors put forward a scenario without explaining WHY that scenario is realistic.
yes, if Innolight or any big optical transceiver maker cut prices, AAOI will plunge. but WHY would Innolight or any transceiver maker cut prices when demand far exceeds supply?
i've had similar convos with generalists saying Nvidia/Micron will plunge if demand for AI and data centers slow down. but WHY would AI/data center demand slow down??
always ask WHY WHY WHY
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Citron Short $AAOI- The anti-$LITE
Two weeks ago $AAOI was $85. Today it's $140. $3.5B in market cap added on a random press release. This stock should trade back to $85 once the roulette wheel stops spinning (which would still put it above consensus)
Let's be clear about something. Citron is not an AI bear. Long $GLW, the fiber backbone every hyperscaler buys more of regardless of which architecture wins. Respect $LITE, Nvidia's chosen partner with real profits and real backlog.
GLW is reasonable. LITE is expensive. AAOI is delusional.
And the customer tells you everything. LITE's anchor is Nvidia , $2 billion invested directly into their supplier, booked solid through 2028, balance sheet that could fund a small country.
AAOI's anchor is Oracle , 30,000 layoffs, $100 billion in debt, negative free cash flow, and a flagship data center expansion that just fell apart over financing. One company picks winners. The other is desperately trying not to be a loser.
ONE NUMBER ENDS DEBATE!!
Nvidia at its peak as THE monopoly in AI chips with $200 billion in annual profits peaked at 40x forward earnings at the height of AI bubble euphoria. And Nvidia earned that multiple with 75% gross margins, monopoly pricing, and no real competition.
AAOI trades at 112x forward earnings, nearly three times peak bubble Nvidia, with 31% gross margins, heavy capex, one customer, and zero pricing power.
To justify 112x you need Nvidia-like margins. AAOI has commodity hardware margins that are one Innolight price cut away from making their already imaginary path to profitability a permanent moving target.
You are paying beyond monopoly multiples for commodity economics , backed by the most leveraged, most financially stressed customer in the hyperscaler food chain.
Could write pages about the Amazon warrants and the execution risks and accounting but why confuse an obvious story.
Expensive has a defense. Delusional does not.
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best report i've seen on Huber+Suhner, an underrated Swiss company with a growing optics business.
H+S has multi-year orders for its OCS from a global hyperscaler (Google?)
opened a huge production facility in Poland last year with plans to increase capacity at least 5x over two years
UBS says that OCS order alone is worth around 10% of its total revenue
Chinese hyperscalers might also use H+S's OCS cause the company has no US-origin content or manufacturing
Fabian is one of my fav semis/optics writers. in-depth and provides all citations. his reports on testing and measurement companies (eg keysight, viavi) are the best on substack
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Published my deep dive on HUBER+SUHNER (HUBN.SW)
Should have been Suhner rather than later, but here we are!
They are 160-year-old Swiss mid-cap that tripled in 6 months. Engineering precision on par with a Swiss watch except they make optical circuit switches (so $LITE are not the only ones making them with good insertion loss), RF cables, and crosslinked polymer insulation.
CHF 1B+ in orders for the first time ever. A hyperscaler POLATIS deal that kicked off a violent re-rating (is it $MSFT?). Add to it a China OCS angle that almost nobody is paying attention to yet.
Full piece below, and as always always open for feedback!
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thanks for spotlighting Huber Suhner. underrated OCS play.
they already have orders from a hyperscaler and is ramping production right now. talking to other hyperscalers in US and China(!)
tho confused why the Huber Suhner booth employee said their OCS insertion loss is 1.5-2 dB. their Piezo OCS is supposed to have the lowest insertion loss
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My supply chain contribution this weekend is pointing out that the SMCI “hairdryer” is likely this electric heat gun, commonly used in server assembly.
Hint Hint. Lumentum publicly discloses the linewidth of their ultra-high power (UHP) lasers (0.5 MHz). Nobody else discloses this number. Almost as if this number is very important for CPO. Maybe I know what I am talking about and the spreadsheet monkeys are wrong?
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Merchant InP laser market shares (Cowen est)
"Three of the four major suppliers have described strategies to increase laser manufacturing capacity, the outlier being Broadcom, which has not explicitly commented on capacity expansion in a public forum, but which we believe is likely expanding capacity as well. Sumitomo Electric, which we estimate had ~22% of the merchant InP market in 2024, plans to increase InP production capacity by 2.4x from 2023 to 2028. More qualitatively, Mitsubishi Electric (~18% share) has described "partially shifting" its ~$1.5B in annual capital investment from power devices to optical devices. Finally, Lumentum (~30% share) has described increasing capacity by 40% from September 2025 to June 2026."
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reminder that Lumentum $LITE has a short interest on par with Super Micro (and GameStop)
unless Lumentum has been lying about its industry leading 200G EML, narrow-linewidth DFB and OCS, then these shorts will be burned
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🚨BREAKING: SUPER MICRO CO-FOUNDER ARRESTED FOR SMUGGLING $2.5B IN NVIDIA GPUs TO CHINA
>SMCI co-founder Yih-Shyan "Wally" Liaw arrested today
>personally holds $464 MILLION in SMCI stock
>charged with smuggling BILLIONS in Nvidia servers to china
>used a southeast asian shell company to funnel $2.5B in servers to chinese buyers
>$510 million worth shipped in just THREE WEEKS in spring 2025
>built thousands of fake dummy servers to fool U.S compliance auditors
>caught on surveillance camera using a HAIR DRYER to swap serial number stickers
>coordinated the whole thing over encrypted group chats
>SMCI down 12% after hours
>faces up to 30 years in federal prison
ITS SO OVER…
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**Incrimental** opinion based on OFC so far. For example, Nvidia showed nothing new so neutral even though recent ISSCC presentation amazing.
Full OFC coverage will take 2-3 weeks. So much stuff.
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