Trade Whisperer@TradexWhisperer
$LITE $GLW $AXTI The Optical Highway for the East-To-West Traffic. The Interconnect Opportunity.
Fiber Optics is here and accelerating. Silicon Co-Packaged Optics and Photonics by $TSM (COUPE) is the next chapter. I am bullish on all three and the thesis is simple 👇
AI training and inference generates massive amounts of east-west traffic, the constant high-speed communication between GPUs and servers inside the data center. Think of it like the streets within a city rather than the highways coming in from outside. When thousands of GPUs are training a large model, they're constantly syncing with each other, all at once, in every direction. This scale and density demands over 10x more optical fiber than traditional data centers.
Fiber delivers enormous bandwidth over longer distances with low latency, low heat, and low power draw. At AI scale these aren't nice-to-haves. They're hard requirements.
Silicon photonics takes this further by moving the optical layer directly onto or next to the chip itself, known as co-packaged optics. This eliminates the signal conversion bottleneck between electrical and optical, slashing both latency and power consumption right at the source.
The AI buildout is nowhere near done. Every new GPU cluster, every new model, every new data center means more fiber, more interconnects, more photonics.
