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Seranity/Precise market analysis
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I’m not sure if you’re aware but the entire AI sector is dropping indiscriminately right now.
A $1T company like Samsung is down -26% this month. $MRVL is down -31%.
So higher beta names tend to move a lot more like $AAOI and $SIVE with their 50% drops.
But recoveries tend to be a lot more volatile like $AEHR 50% single day gain after ER.
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Lot of people were curious about $SIVE capacity volume ramp modeling through fab-light (Win Semi + others):
Using 10% of Win's wafer capacity as a low-end allocation (65% yield assumption, $50-$75 ASP):
Sivers would support $341-$512M worth of annual array revenue. Given upper end of managements 50-60%+ gross margin target, would be roughly:
$205–307M of annual gross profit.
Against Sivers current ~$1.1B MC, would be ~:
3.6–5.4× MC/gross profit if this capacity scenario plays out in 2028.
And at 15% would be $307–461M in gross profit (2.4–3.6× MC/gross profit)
Sivers CEO also replied that they're working with more fabs for capacity. And from an older deck, there looks to be more qualifications since 2024.
So capacity targets might be larger than what's stated here as CPO takes off.
I also expect to see revenue pipeline projections hiked in future quarters, as more qualification suppliers to into HVM.
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As for demand side, CW also happens to be very bottlenecked.
Lumentum are buying CW off the open market due to EML obligations from their ER transcript.
And $AMD are signing LTAs to secure CW capacity (from Trendforce). So when Sivers is ramping with $GFS, $JBL, Ayar, $POET, O-NET and others...
Given the current constraints, it's highly likely any independent qualified capacity that comes online would be absorbed.
And as a cherry on top, Morgan Stanley named $SIVE (~$1.1B) as one of the three leading CPO laser players .
Alongside $55B+ players Coherent and Lumentum in their recent note for a reason...
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TLDR: Sivers only needs a low end allocation from Win to make substantial gross income relative to current valuations.
I think the largest revenue upside that isn't modeled in if they TAM expansion with M&A after US NASDAQ listing.
By copying the Lumentum playbook with Cloud Light to build out entire transceiver modules or with optical engines.
Anders Storm@StormDirac
Your assumptions are wrong. Win Semiconductors has a InP capacity of 35.000 wafers per year. Assume even a low number 10% of that is 3500 wafers. There are approximately 3000 CW arrays on a wafer, price per Array >$50. At only 10% of this capacity Sivers could sell for more than $500m just for arrays..then you have pluggables, wireless...at 20% capacity...even more. Production qual has been ongoing for sometime, as WIN mgmt confirmed, hence should not be too far away.
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I personally think valuations are extremely stupid now on $AAOI and $SIVE.
With AAOI you're doing $5.62B annualized revenue (probably higher), by midpoint next year. And it's a $8B MC.
With Sivers, I would est. it's close to ~5 forward 2028 P/E off 10% win allocation, 65% yield, and $75 ASP.
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Today, $MU announced it signed memory LTAs with $QCOM.
Interesting reaction to see Micron proceeded to drop 5.37% right after.
Doesn’t quite feel like there’s anything individually wrong with memory or AI names with all these structural agreements signed?
More like the tail end of deleveraging / margin cascades.
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I don't see any fundamentally wrong. There's probably going to be large corrections from time to time flush out margin/leverage before things move higher.
And this month seems like that time of year?
$POET confirmed your big optical giants like $LITE, $COHR are completely sold out for the next 2 years, and likely into 2029 for photonics.
Innolight confirmed 800g transceiver upward revisions 3 days ago, so that should be positive for $AAOI and the others.
Samsung became the most profitable company in the world, and continues to project DRAM hikes for future quarters. $MU signed 16+ LTAs showing memory demand is structural...
$META + hyperscaler capex plans are on the higher end of projections.
I wouldn't conflate short term price movements with longer term trends. And as seen with $AEHR, recoveries tend to be extremely fast (eg. 1M of corrections wiped out overnight).
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$NVDA CEO, Jensen Huang in Tokyo today said:
"The reports are not true. Vera Rubin is already in production. Giant amounts of production incoming"
As a flat denial to the accusation that their AI servers would be delayed.
Jensen appears to be using the Umbrella term for Rubin Ultra/Kyber, then pointed to current gen ramp.
Regardless, lot of damage has been done already to Nvidia supply chains stock prices, after the multiple delay reports. Even if Nvidia refuted them by clarifying Kyber change was an architecture optimization, not impacting timelines.
It's a very dangerous and growing trend for folks to post overreaching broader claims from technical nuances to grow viewcount... Especially if they get Jensen has to respond.
In the end, I'm trusting $NVDA on timelines since they probably have the greatest visibility into their own supply chain.
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Yeah that's the unfortunate reality of headline algorithm trading nowadays.
Sector tanks 20-50%+ off delay news, then causes cascading margin liquidations.
"Delay refuted" news comes out, people still cast doubts over it, and markets focus on misleading delay reports weeks later over fundamental growth opportunities.
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@avshushka Just forwarding the Rosenblatt channel check on optical sector weakness:
x.com/aleabitoreddit…
Serenity@aleabitoreddit
Rosenblatt on recent optical sector weakness from $AAOI to $LITE: "Stocks in the Optical sector have traded poorly for the last 1-2 months" due to CPO delay reports and China capacity scares. "We think short sellers... do not actually strongly believe in the thesis." Multiple short sellers told them they will likely close their positions... late July and early August. Further, they say they plan to buy Optical stocks in 2027 for the scale up CPO opportunity. Hilarious report on laser weakness, read is very positive for $SIVEF, $COHR, and others moving forward. I've been long on CPO sector, but seems like institutions want entry points, just a bit later on.
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It's nuanced, $AEHR implications was more toward broader silicon photonics related ramp.
Which could include 800g/1.6T pluggables, or CPO.
If they directly named CPO, Msscorps would be a very clean readthrough. It just got hit really hard recently from that delay claim (even after $NVDA refuted it), since it's it's upside seems tied to CPO yields in specific.
So it's positive, just uncertain.
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$AEHR back up +36.4% today off earnings!
2027 guide: $130-$150m (160-200% growth) from 2026 revenue. Sees opportunity to guide higher (assumes no memory revenue or little to none from newly benchmarked AI customer).
Q4 bookings: $60.7M, effective backlog is $100.6M.
- Lead AI processor wafer-level burn-in customer is significantly ramping their products.
- Engaged with additional AI processor customers who are evaluating wafer-level burn-in.
- Benchmark customer, which was a “major supplier of AI accelerators, CPUs and network processors” “exceeded their expectations.
From management: The potential revenue opportunity from one of these devices is "significant to Aehr". So another benchmark win for potential HVM in the future.
- Wafer level burn-in benchmark with a "global leader in NAND flash completed". Now evaluating a development agreement for HBM/NAND
Seems like $SNDK since there was HBF related discussions from last quarter I think.
- "Our package level burn-in business for AI processors also gained momentum over the year … from our lead hyperscale customer for Sonoma systems"
- Silicon photonics customer already ramping, newer networking customers has forecast additional systems
Basically the amount of global semi companies that map to $AEHR is pretty ridiculous across silicon photonics, memory, AI processors, and others.
I don’t quite think that $130-$150m guidance is representative of actualized revenue for 2027 if these hyperscalers/semi companies convert to HVM.
Typically with these types of qualification into HVM players, markets don’t really judge it by current quarter, but what’s to come.
And it looks very positive so far in terms of reactions...
$116 -> $60 -> $94 all in the span of a month is pretty insane volatility tho, so good to know what you're holding.
Serenity@aleabitoreddit
$AEHR looks extremely promising at ~$1.1B MC. Aehr is starting to remind me of an early $TER, mixed with pre-earnings $AAOI. If we look at the timeline and speculated customers: Feb 11th: Sonoma production win for Hyperscaler's AI ASIC processors. (likely $GOOGL, $AMZN, $META). - Probably Google? Aehr bought Incal, who was speculated to be used by Google for their TPUs. Feb 26th: $14 million from AI lead customer (likely $AMD, $NVDA) - Probably $AMD here for Instinct MI300/MI400. March 3rd: Lead silicon photonics customer for one FOX-XP system (likely $INTC siph) - Very likely $INTC has been their lead customer. March 31st: Initial order from major new silicon photonics customer (likely $AVGO, $MRVL, $CSCO ) - New customer (rules out Intel), prob one of these transitioning to 800G/1.6T silicon photonics transceivers (All speculative, very confidential BOM) Regardless. This timeline is just bottling up for $AEHR. Could be next earnings. Or two quarters from now. But feels like a matter of time before we see mass orders.
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