Shit is so bad that Sievers got re named to Seivers. LOL. Fun take. Have to agree that if you are not at least in Lumentum what are you even doing? As for AXTI, If 80% of InP already going to AI, let’s shoot down the remaining 20%.
Hey Irrational Analyst, what are your thoughts on picojool’s VCSEL ? I heard Al Yuen on Semidoped podcast and from a macro view looks like a viable solution to some intern connect problems . In your view , Will this kind of active interconnects dent InP’s demand ? Appreciate your thoughts .
A forward-looking footnote on the wafer layer, since the shortage may look different a few years out. JX Advanced Metals — which, together with Sumitomo Electric, is estimated to hold roughly 40% of the global InP-wafer market — announced on June 16 a ¥120B (~$750M) investment to raise its InP-wafer capacity to 7–10x the FY2025 level over four years.
Dude I fully understand the hatred of serenity for his SIVE shillung, but outside of that the overlap is quite significant. He's big in AXTI, AAOI, LITE, TSEM and SOI as well
I think you’re right until supply becomes such a shortage that pricing power flips to LNP. I don’t know enough about how well supply can keep up, but the 80% AI mark suggests to me that a much higher percentage increase in LNP production has and will be required for AI than DRAM
I think the current situation for InP (Indium Phosphide) related stocks is somewhat like "strong fundamentals, but not cheap valuations." Demand from AI data centers and optical communications is indeed very strong, and the tight supply and demand of InP lasers has also brought good growth opportunities to related companies. However, after this round of price increases, the stock prices have already reflected much of the future growth expectations.
Personally, I prefer to wait for a significant pullback before buying, rather than chasing the price up. COHR (Coherent) is relatively more attractive from a valuation perspective, while LITE (Lumentum) may have a stronger growth logic in AI optical modules/optical communications, but the market is giving it a higher valuation premium. Ultimately, it depends on whether the profit growth in the next few years can keep up with the current stock price expectations.
ye check out Semianalysis ETFs (wisdomtree, LAZR, DISK), the overlap with irrational analyst is kinda crazy. Ticker LAZR is big in LITE, AIXA, AXTI, AAOI etc.
Shit is so bad that Sievers got re named to Seivers. LOL. Fun take. Have to agree that if you are not at least in Lumentum what are you even doing? As for AXTI, If 80% of InP already going to AI, let’s shoot down the remaining 20%.
Hey Irrational Analyst, what are your thoughts on picojool’s VCSEL ? I heard Al Yuen on Semidoped podcast and from a macro view looks like a viable solution to some intern connect problems . In your view , Will this kind of active interconnects dent InP’s demand ? Appreciate your thoughts .
A forward-looking footnote on the wafer layer, since the shortage may look different a few years out. JX Advanced Metals — which, together with Sumitomo Electric, is estimated to hold roughly 40% of the global InP-wafer market — announced on June 16 a ¥120B (~$750M) investment to raise its InP-wafer capacity to 7–10x the FY2025 level over four years.
https://www.jx-nmm.com/newsrelease/2026/20260616_01.html
Dude I fully understand the hatred of serenity for his SIVE shillung, but outside of that the overlap is quite significant. He's big in AXTI, AAOI, LITE, TSEM and SOI as well
“Only 25% of the worlds DRAM goes to AI. Can just take more from consumer. 80% of InP already going to AI.”
Well, this can be seen at a different angle. Plenty of consumer buyers push DRAM spot prices up and contract prices follow the trend.
Having a handful of big AI buyers and nearly zero of consumer ones in InP gives AI buyers (hyperscalers) a way to control prices.
The same true for optics.
I think you’re right until supply becomes such a shortage that pricing power flips to LNP. I don’t know enough about how well supply can keep up, but the 80% AI mark suggests to me that a much higher percentage increase in LNP production has and will be required for AI than DRAM
Thanks for the note. 80% of the technical jargon goes way over my head, but I appreciate the confidently expressed opinions.
What do you all think of the valuations of the InP stocks now?
I think the current situation for InP (Indium Phosphide) related stocks is somewhat like "strong fundamentals, but not cheap valuations." Demand from AI data centers and optical communications is indeed very strong, and the tight supply and demand of InP lasers has also brought good growth opportunities to related companies. However, after this round of price increases, the stock prices have already reflected much of the future growth expectations.
Personally, I prefer to wait for a significant pullback before buying, rather than chasing the price up. COHR (Coherent) is relatively more attractive from a valuation perspective, while LITE (Lumentum) may have a stronger growth logic in AI optical modules/optical communications, but the market is giving it a higher valuation premium. Ultimately, it depends on whether the profit growth in the next few years can keep up with the current stock price expectations.
LAZR
ye check out Semianalysis ETFs (wisdomtree, LAZR, DISK), the overlap with irrational analyst is kinda crazy. Ticker LAZR is big in LITE, AIXA, AXTI, AAOI etc.
I’m too much of a photonics normie to pick individual stocks.