10x Stock Opportunities in the AI Optical Communication Chain: From Corning to Ciena
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10x Stock Opportunities in the AI Optical Communication Chain: From Corning to Ciena
A comprehensive photonics supply chain overview—and the golden high-growth stocks you must closely monitor before Wall Street’s massive influx and belated realization.
Navigating Web3 tides with focused insightsCompiled & Translated by TechFlow
Host: Brian, formerly of Target & Amazon
Podcast Source: BWB – Business With Brian
Original Title: Millionaires are Hitting These 10X Stocks HARD!
Air Date: June 21, 2026
Key Takeaways
The real bottleneck in AI data centers isn’t a single “chip winner,” but rather the entire photonics supply chain—from converting electrical signals into optical ones to moving massive volumes of data out. Brian’s core thesis is that as the industry upgrades from 800G to 1.6T—and onward toward 3.2T—the first companies to capture outsized returns are often not the headline-grabbing stars on center stage, but essential suppliers like Corning, Amphenol, and Ciena—companies no major player can bypass—as well as upstream material and test equipment providers. This episode walks you through the full photonics supply chain and highlights the highest-growth “golden stocks” you need to watch closely—before Wall Street’s stampede arrives and prices surge.
Key Insights Summary
Why AI Data Centers Must Shift to Optical Communication
- “Copper cables are hitting a hard physical limit—every data center will ultimately have to transition to optics. China has already proven to the entire industry that this path can go much further.”
- “Once transmission distance exceeds roughly 3 feet, copper rapidly loses its advantage—generating more heat and consuming more power—while optics solves both issues simultaneously.”
- “Shifting from electricity to light—that’s the core meaning of photonics.”
Why Investment Opportunities Often Lie in the Supply Chain, Not the Headline Companies
- “Once a new technology proves viable, outsized wealth flows first to companies every participant must rely on—not just the one name dominating headlines.”
- “Glass, lasers, connectors, materials, and test equipment—none of these can be skipped. That’s where the photonics supply chain truly creates value.”
What Makes Corning Compelling
- “Corning’s optical communications revenue grew 36% last quarter—but its profit in that segment surged 93%, signaling simultaneous pricing power and scale effects.”
- “Corning has become the named, mission-critical supplier for Meta, Amazon, Google, Microsoft, OpenAI, and Nvidia. No other competitor holds such a client roster—and those relationships have already translated into multi-year, pre-contracted revenue.”
- “Meta committed up to $6 billion; Amazon signed multi-billion-dollar contracts; two other hyperscalers signed agreements of similar magnitude—and much of that revenue is locked in years before fiber is even pulled.”
What Amphenol and Credo Represent
- “If you want a broader, less volatile, reasonably valued optical interconnect play, Amphenol is a name worth watching long-term.”
- “Credo serves as the bridge between the old world and the new—maximizing copper cable life within racks while also extending into optical interconnects.”
- “Credo’s risk is clear-cut: extreme customer concentration. A pause in procurement by just one mega-customer could severely dent its stock price.”
Opportunities in Systems, Upstream Materials, and Test Equipment
- “Ciena’s value lies in enabling existing fiber to carry far more data—without digging up and re-laying new lines.”
- “AXT sits even further upstream—essentially a scarce supplier of key indium phosphide (InP) wafer material for optical lasers—but faces high Chinese export licensing risk.”
- “VEO Solutions is the ‘pick-and-shovel’ provider of the optical communications world: whether it’s fiber links, transceivers, or system equipment, everything must be tested before deployment and monitored during operation—and VEO sells precisely the test tools all those devices require.”
Thematic Allocation & ETF Options
- “If you’d rather not pick individual names, pure-photonics ETFs now offer one-click exposure to this theme.”
- “But these funds are newly launched—still small in assets under management and with relatively high fees—making them better suited for your watchlist than for blind, momentum-driven buying.”
China Just Raised the Fiber-Optic Ceiling—Significantly
Brian:
Engineers recently lit up a single strand of glass fiber in China capable of carrying five times more data than current global benchmarks. This wasn’t a new line laid down—or large-scale excavation—but rather activating an ultra-thin fiber, thinner than a human hair, already buried underground inside existing conduit. What used to take half an hour to move the entire U.S. Library of Congress’s data now takes about five minutes.
This technology hasn’t yet landed in the U.S.—a stark reminder of how fast this field is evolving. AI is generating data floods far beyond today’s transmission capacity, and U.S. data centers are increasingly starved of it. Every hyperscale cloud provider will eventually need it—and none will build the entire stack from scratch. They’ll buy it.
They’ll buy glass, lasers, and chips that convert electricity to light—and only a handful of suppliers can deliver these components. Having spent years on the supply-chain procurement side of this industry, I’ve seen this pattern repeat again and again: once a new technology proves viable, outsized wealth flows first to companies every participant must rely on—not just the one name dominating headlines.
Why Photonics Is Becoming the Core Variable—Right Now
Brian: Today, I’ll break down the entire photonics supply chain—and identify the publicly traded companies behind each layer. Why photonics? And why now?
The answer boils down to one hard constraint. Inside the data center, all chips must communicate with one another. Over short distances, copper still wins—but once you try to transmit data beyond ~3 feet, copper’s flaws surface quickly: longer distances mean higher heat and higher power draw.
Optics solves nearly all these problems at once—it travels farther, generates less heat, and consumes only a fraction of the power required by copper solutions. Shifting from electricity to light—that’s the core meaning of photonics.
More importantly, this inflection point is unmistakable. Every data center is upgrading from 800G to 1.6T—and 3.2T is already on the table. Meanwhile, that fiber demonstrated in China just lifted the industry’s ceiling—again.
If we break it down, the most critical layers include: glass, fiber, and cable—the actual medium carrying light; connectors—the hardware linking everything together; systems equipment—devices that light up fiber and move data across buildings and countries; and deeper-layer materials and test equipment. Chips, lasers, and silicon photonics themselves were covered in prior videos—so today, we focus on the frequently overlooked—but equally profitable—layers.
Within each group, I’ll highlight names worth adding to your watchlist. But let me be clear: many of these names have already run up sharply—so the next truly attractive entry point may well require a pullback.
Why Corning Stands Out in Glass & Fiber
Brian:
Let’s start with the foundational layer—glass—and the first name is Corning. A 175-year-old materials company, Corning actually draws the fiber—the “glass thread” referenced earlier in this video. It holds ~20% global market share in optical fiber—already a central player.
Where Corning truly pulls ahead is in technology. Its latest-generation fiber packs roughly twice as many cores into the same physical space as standard cable—a capability urgently needed in today’s hyper-dense AI data centers. Its bend-insensitive glass is also extremely difficult for peers to replicate. Add in the world’s largest fiber factory and U.S.-based production compliant with “Buy America” rules—and you have its true moat.
That’s why Corning has become the named, mission-critical supplier for Meta, Amazon, Google, Microsoft, OpenAI, and Nvidia. No other competitor holds such a client roster—and those relationships go far beyond “good cooperation.” They’ve already translated into multi-year, pre-contracted revenue.
Demand for fiber is growing ~22–25% annually—but industry-wide new supply capacity is only about half that rate. Lead times have stretched beyond 60 weeks. So hyperscalers lock in capacity years in advance—even paying upfront to secure it. Meta committed up to $6 billion; Amazon signed multi-billion-dollar contracts; two other hyperscalers signed agreements of similar magnitude—and much of that revenue is locked in years before fiber is even drawn.
What caught my attention most was profit leverage. Corning’s optical communications revenue rose 36% last quarter—but profits in that segment surged 93%, more than double the revenue growth—exactly what pricing power and scale effects look like in action. Across the entire company, operating margins have climbed from ~8% two years ago to over 16% today—and management targets 20% by year-end.
Of course, realism demands acknowledgment: this story is no longer secret. Corning currently trades at a PEG near 3 and a P/S ratio of ~9x—expensive for a materials company. So if you want the safest, lowest-drama way to gain exposure to fiber, Corning fits—but a more prudent rhythm is waiting for the next meaningful pullback.
Core Companies in the Interconnect Layer: Amphenol and Credo
Brian:
Next comes the interconnect layer—the one that physically ties all components together. The first name here is Amphenol. A remarkably low-profile giant, Amphenol makes high-speed connectors and cables—both copper and optical—and its products appear in nearly every newly built AI server rack.
The key to understanding Amphenol is that it operates essentially as an exceptionally efficient acquisition machine. In January, it acquired CommScope’s entire fiber-optic connectivity business for $10.5 billion—overnight transforming itself from a connector specialist into a heavyweight fiber player. Today, AI data center business is its core engine—the largest single segment—with organic growth exceeding 80% last quarter.
Its order backlog has hit a record $9.4 billion—and new orders continue outpacing shipments. As quarterly revenue jumped from ~$4 billion to just over $7 billion, its operating margin didn’t shrink—it expanded from 22% to nearly 28%.
This is highly notable. Normally, a $10 billion-plus acquisition would pressure margins for at least one to two years due to integration overhead. Yet Amphenol’s margins rose—demonstrating exceptional ability to rapidly integrate acquisitions into its high-standard operational framework. As a result, this massive deal didn’t become a burden—it became a profit accelerator.
Even more impressively, its valuation remains reasonable. Amphenol trades at a PEG of ~0.7 and a P/S ratio around 7x—unusual for a company growing this fast. So if you want a broader, less volatile, reasonably valued optical interconnect name, Amphenol is very much worth watching long-term.
The second name in the interconnect layer is Credo Technology. It plays the role of bridge between the old world and the new. On one hand, it uses low-power chip technology to squeeze maximum performance from intra-rack copper cabling. On the other, it develops optical interconnect chips and cables—seamlessly stepping in when signals must travel farther.
It recently acquired a silicon photonics company, completing its end-to-end product stack up to 1.6T—and has already shipped to all five top U.S. hyperscalers. Its growth is staggering: quarterly revenue rocketed from $135 million to $437 million in just six quarters—more than tripling.
Another telling metric is its ~68% gross margin—a figure more typical of software firms than hardware companies. Meanwhile, its operating margin has nearly doubled to 37% as scale kicks in. Management’s revenue guidance for next fiscal year remains >80% growth.
But the risks here are concrete—and must be taken seriously. Though it supplies all five top customers, just three account for 88% of its revenue. If any one hyperscaler slows procurement, the stock could face swift, severe downward pressure. Coupled with insider selling during the rally—and a current P/S ratio of ~35x—the market is effectively pricing in “everything continuing flawlessly.” Its PEG near 1 confirms strong growth—but this is a high-conviction, deep-pullback-only kind of opportunity.
The True Key Player in the Systems Layer: Ciena
Brian:
Moving up the stack, we reach the systems layer—the one that lights up fiber and moves data across buildings and nations. The pivotal name here is Ciena. The Western leader in coherent optics, Ciena’s proprietary WaveLogic technology was the first globally to pack 1.6T of data into a single-wavelength optical signal. Think of it as a “no-dig upgrade cheat code”—it lets existing fiber carry vastly more data without re-laying cable.
And this isn’t lab-demo tech. In just two quarters, this single product has won 49 customers. Its positioning with major clients is also exceptionally strong: its solutions are already deployed by three of the four top hyperscale cloud and service providers—and cloud customers now contribute nearly half its revenue.
For me, the most critical metric remains backlog. Last quarter, Ciena’s backlog grew ~$2 billion in 90 days—to nearly $7 billion. Almost all of it is scheduled for delivery next year—meaning it has already locked in over a year’s worth of revenue.
As revenue hits an all-time high—up 40% year-over-year—its operating margin has doubled from under 8% to over 15%. The problem? The market knows all this too—so valuation is extremely aggressive. Ciena currently trades at an expected P/E of ~120x—priced almost entirely on “perfect execution.” Fundamentals are excellent—but price demands respect.
The Real Bottleneck Further Upstream: AXT and Test Equipment Provider VEO Solutions
Brian:
Next comes my favorite layer—the ‘supplier behind the supplier.’ The most upstream name in this entire episode is AXT. Few companies globally can produce indium phosphide (InP) wafers—and this specialized crystal is the foundational material upon which all optical lasers must be built. From this perspective, it’s inherently moated—crystal growth capability simply cannot be bootstrapped overnight.
Now, as all laser makers compete for limited supply, AXT’s backlog for this material has breached $100 million—setting a record. But its risks sit at the very top of this list—and are highly specific. Nearly all its manufacturing occurs in China, where every export shipment now requires government licensing. This has already directly impacted last quarter’s revenue realization—even with that record-breaking backlog sitting right there, it doesn’t guarantee smooth fulfillment.
In addition, the company raised ~$550 million—causing shareholder dilution; insiders net-sold over $70 million in shares during the rally. More troublingly, it remains unprofitable—though losses are narrowing and gross margin has risen from 17% to ~30%.
So AXT’s story is real—and its bottleneck is real—but its current P/S ratio of ~66x reveals it’s more like a high-volatility, high-risk “lottery ticket” for small positions—not a core holding suitable for large allocations.
The final name in this layer is VEO Solutions. It’s the ‘pick-and-shovel’ provider of the optical communications world—because whether it’s fiber links, transceivers, or system equipment, everything must be tested before going live and monitored during operation—and VEO sells precisely the test tools all those devices require.
The beauty of this position is its agnosticism toward winners. You don’t need to bet on which laser company ultimately wins—or which transceiver format becomes dominant—because whoever wins still needs VEO’s equipment for testing. This is a business model I personally love.
For years, VEO’s revenue barely budged—stuck near ~$285 million per quarter. Only when AI infrastructure build-out accelerated did its network test business explode—up >54%—as data centers rushed to validate massive volumes of new optical gear. Quarterly revenue now exceeds $400 million, and operating margin has returned to double digits.
Beyond that, the company runs a quieter—but highly profitable—second business: producing anti-counterfeiting coatings printed on banknotes worldwide—adding another high-margin pillar to its overall profile. Note that insiders—including the CEO—have continued selling shares. Its current PEG is ~1.4—not extreme, but like others on this list, it’s already run up significantly—so the more rational approach remains waiting for it to cool off.
If You Don’t Want to Pick Individual Stocks, There’s a New Pure-Photonics ETF
Brian: Many may ask—why didn’t we spotlight Coherent, Lumentum, Marvell, Broadcom, or the actual wafer fabs making chips today?
These companies absolutely belong on your watchlist—they sit at the heart of the laser and silicon photonics segments, vital parts of this theme. I’ve previously covered them in depth—so today, I wanted to spotlight the often-skipped layers: glass, connectors, systems equipment, and their underlying suppliers.
If you’d rather avoid picking names one-by-one, there’s now a one-click way to allocate across the entire theme. A brand-new pure-photonics ETF—FOTO, the Tuttle Capital Pure Play Photonics Fund—has just launched.
What I like about it is its strict “pure-theme” screening. It excludes large conglomerates whose photonics businesses represent only a tiny fraction of total revenue—and concentrates positions exclusively in genuine optical companies. Its top holdings are exactly the laser and transceiver names discussed earlier—Lumentum, Coherent, Fabrinet, plus IPG Photonics and Inphi. The fund holds just 15 names—with the top 10 accounting for nearly 90%—so its style is highly concentrated and explicitly bets on “pure photonics.”
Of course, full transparency is required. This fund launched only weeks ago—lacking any real long-term track record—and manages just ~$140 million, with a 0.75% expense ratio. So thorough due diligence is essential. But if you simply want to add the “copper-to-light” theme to your watchlist, FOTO is certainly worth tracking.
Conclusion: Copper Has Hit Its Limit—Beneficiaries Will Spread Across the Entire Optical Chain
Brian: Let’s wrap up. Copper has hit its physical limit—and every data center on Earth must migrate to light. China has already shown the industry this path can go much further.
Capital is already flooding into this chain. The real question is no longer whether this shift happens—but which group of companies captures the greatest incremental upside during this accelerating transition.
If you combine the laser and silicon photonics companies I’ve covered before—with the glass, connectors, systems, and upstream suppliers highlighted in this episode—you now hold a comparatively complete map of the end-to-end photonics supply chain.
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