Applied Optoelectronics forecasts a 144% year-over-year revenue increase for Q2, driven by strong demand for 400G and 800G transceivers amid data center growth. Production in Texas will begin this summer, aiming for 100,000 units monthly by year-end to fulfill hyperscaler requirements. The company has secured design wins outside Amazon, which could bolster long-term revenue. Although revenue growth is anticipated, earnings remain negative owing to pressure on gross margins and rising costs associated with production scaling.
Applied Optoelectronics anticipates a 144% year-over-year growth in Q2 revenue, driven by demand for 400G and 800G transceivers supported by data center tailwinds.
The company plans to ramp Texas production to 100,000 transceivers per month by year-end, aligning with the needs of hyperscale data centers and market demands.
Design wins have expanded beyond Amazon, highlighting the potential for stable revenue from hyperscale customers and the chance to trigger significant warrant conversions.
Despite expected increases in revenue, the company is still contending with profitability challenges due to gross margin pressures and escalating ramping costs.
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