Optical Networking Is AI's Most Overlooked Bottleneck. Here's Why This Nvidia-Backed Company Is the Stock to Own. - Yahoo Finance

As the artificial intelligence (AI) industry expands rapidly, the demand for high-performance computing and data transmission is increasing, yet optical networking — a critical component of AI infrast... Read original →

NVIDIA’s $2B bet on Coherent isn’t just about optical modules—it’s a strategic move to preempt the AI interconnect bottleneck. As GPU clusters scale beyond 10,000 chips, copper-based links hit physical limits, forcing urgent adoption of 1.6T and 3.2T optics. This triggers cascading upgrades across InP wafers, silicon photonics, and advanced packaging. While the $50M CHIPS Act grant eases CapEx, U.S. reliance on Japanese and German photonic materials exposes supply chain fragility. Competitors like Lumentum and Taiwan, China’s Source Photonics will accelerate CPO and silicon photonics integration to counter Coherent’s NVIDIA-backed edge. Within 18 months, optical interconnects will shift from cost centers to strategic control points—determining who sets the architecture—and pricing—of next-gen AI data centers.