Joseph Mason Boyle

Everyone is working on 6-inch capacity... $COHR $AAOI $LITE $NOK But do you know who is the furthest ahead?

Let’s make $NBIS reach $220 again now after we tapped $180 in the overnight session. ⏳

If you care about Photonics, read this $AXTI $SIVE $LITE $COHR $GLW $AAOI etc. There are lots of important updates here The one I want to talk about in this post is InP substrates If you have been following the $AXTI story, you are familiar with InP substrates They are the starting material that the downstream optical components are typically built on. The components that companies like $lite $cohr $aaoi $sive make Substrates have been a chokepoint for two main reasons. 1 - There just aren't enough of them to meet the demand from customers and their forecasts. 2 - They are gated by geopolitics. Much of the concentration of supply is in China So the lack of supply visibility has lead to downstream constraints all the way from lasers to modules. Now GS is forecasting that InP substrate supply is going from 'very tight' to 'tight'. This shouldn't come as a surprise. We know that AXT is massively expanding capacity over the coming quarters/years. Doubling in 2026 and doubling again in 2027. We also know that other China supply is ramping. Yunnan Germanium, Guangdong Xiandao and others. That is all great for downstream companies. More visibility on substrates means more confidence in their capacity ramps and better conditions to meet customer demand. This flows through the whole chain ... If $LITE for example can source more substrates, they can justify more tool purchases, they can sell more lasers, more transceivers could be made, more fiber can be laid, more components can be tested and assembled etc. For $AXT it means more competition. But GS also forecasts pricing staying strong for substrate suppliers so it's not like there is near term margin compression. We also don't know how much of this 'capacity' is qualified capacity that is able to be shipped internationally. So there is an asteric There is also a read through from the optical cables update here for $glw and the fact that optical devices is staying tight is good from the supply/demand environment and a counter to oversupply concerns in the near/mid term