〈Focus Stock〉NVIDIA's CPO Optical Switches Enter Mass Production, Boosting Optical Communication Stocks; Six Firms Including AU Optronics Surge to Limit Up

AI giant NVIDIA (NVDA-US) has entered the mass production phase for its Spectrum-X Ethernet Photonics CPO (Co-Packaged Optics) optical switches, triggering a sharp rally in optical communication-related stocks. On the market, six companies—Opto Tech (6442-TW), AU Optronics (4979-TW), Opto Tech (3234-TW), Frontend (4908-TW), Dongshin (6588-TW), and Shangxian (3363-TW)—all surged to limit-up gains. During trading, these stocks flipped from losses to gains mid-session, with buying orders flooding in, driving them to rise from the opening and hit their daily limit-up thresholds.

According to institutional analysts, as AI data center clusters expand, the demand for higher transmission bandwidth and lower power consumption in switches has simultaneously increased. NVIDIA's Spectrum-X Ethernet silicon photonics switches, developed using CPO technology, have now entered the full-scale mass production shipping phase, accelerating demand for optical fibers and co-packaged optical components among related suppliers.

In the broader market, in addition to the six stocks hitting limit-up gains, companies such as Consort (4977-TW), Lianya (3081-TW), Lianjun (4977-TW), Tung Shin (6426-TW), and Boruiwei (3163-TW) also surged by over 7%.

Institutional sources indicate that the optical communication industry outperformed expectations in Q2, primarily due to strong demand for AI and general-purpose servers. Revenue for Q3 and Q4 is projected to grow sequentially by 9% and 22%, respectively, with continued capital expenditure and production expansion to meet robust demand expected over the next two years (2025-2026).

Analysts note that Taiwanese optical communication stocks, after a 2-3 month slump, have made a strong comeback, with today's trading volume becoming a focal point for market funds. The optical communication industry, from upstream indium phosphide (InP) substrates to chip shipments, remains in a supply shortage, making it a safe haven for funds within the electronics sector. However, investors without positions are advised to avoid chasing high prices and instead look for opportunities to buy on pullbacks.

Institutional sources indicate that the optical communication industry outperformed expectations in Q2, primarily due to strong demand for AI and general-purpose servers. Revenue for Q3 and Q4 is projected to grow sequentially by 9% and 22%, respectively, with continued capital expenditure and production expansion to meet robust demand expected over the next two years (2025-2026).