If you put $10,000 in Micron one year ago, you’d have almost $40,000 today. And if you drop that money into SanDisk, you’d have over $100,000 right now. That’s because these companies are solving big bottlenecks in the AI market. So data centers are buying everything they make. And in this video, I’ll highlight three more AI stocks winning big for the same reason, making them a great way to get rich without getting lucky. Your time is valuable, So, let’s get right into it. First things first, I’m not here to hold you hostage. This video is all about optical networking, and here are the stocks I’m going to cover. Lumentum, ticker symbol LITE, which is the leading supplier of lasers and optical switches for AI data centers.
Coherent, ticker symbol COHR, which builds high-speed transceivers and optical interconnects.
And Sienna, ticker symbol C-I-E-N, which builds long-haul optical networks connecting multiple data centers together and of course which of these three stocks I think is the best buy right now.
Introduction to Optical Networking
I want to make the best use of your time, so let’s start with the big picture and cover what these companies have in common, like their markets, their revenues, and their risks right now.
Ai data centers have three big bottlenecks: compute, memory, and networking, they’re also limited by power, so every watt of compute, memory, and networking matters even more.
AI Data Center Bottlenecks
Gpus used to be the main constraint, but with each new generation, like Nvidia’s Hopper, Blackwell, and Rubin, we have more compute capacity than most models actually need, so the real limit becomes how fast those gpus can access data and how quickly that data can be moved.
That’s why I spend so much time covering companies like Micron, Broadcom, and Arista Networks, and why they’ve all outperformed the market.
Table of Contents
1. Introduction to Optical Networking
2. AI Data Center Bottlenecks
3. Optical Networking Explained
4. Lumentum, Coherent, and Sienna
5. Frequently Asked Questions
But something big just happened in this space, which is why I’m making this video right now: Google DeepMind just released a data compression method called TurboQuant, which optimizes how data is stored, retrieved, and reused by gpus.
Optical Networking Explained
Without getting too into the weeds, every time an ai model generates a token, it has to store lots of numbers in what’s called the kv cache, for models with billions of parameters and long context windows, that kv cache can eat up most of a gpu’s memory.
TurboQuant is a huge deal because it cuts the kv cache size by over 80 percent, it speeds up key parts of inference by up to 8x, and it can be applied to existing models without any retraining or fine tuning.
- Optical networking is a full stack technology
- It includes tiny laser chips and photonic components
- Transceivers are used to transmit and receive data
- Full optical systems and software stitch all those links together into complete networks
- Lumentum, Coherent, and Sienna dominate different layers of this stack
That means the network just became the next big bottleneck, so optical networking just became even more important.
Lumentum, Coherent, and Sienna
Optical networks transmit light through glass fibers, which can carry much more data over much longer distances with much lower losses and interference, so while copper is great inside a server or inside one rack, serious ai clusters need optics to move data between racks, between buildings, and even across continents using undersea fiber.
Optical links can push 400G, 800G, or even 1.6T of bandwidth per port.
| Company | Revenue | Growth |
|---|---|---|
| Lumentum | $665 million | 65% year over year |
| Coherent | $1.7 billion | 17% year over year |
| Sienna | $1.4 billion | 33% year over year |
G stands for Gigabits per second. Your copper internet connection at home is probably hundreds of megabits to 1 gigabit per second. If you google internet speed test, you’ll see your current internet speeds, and hopefully they’re close to what you’re paying for. 1 gigabit per second is fast enough to stream dozens of 4k videos at a time a 400g optical connection in a data center is 400 times faster than that and 1.6 t means 1.6 terabits per second or 1600 g that’s the kind of bandwidth that large ai clusters need as gpus start pumping out more tokens every second one more important point before we get into the stocks optical networking isn’t a single product it’s a full stack tiny laser chips and photonic components generate and detect the light.
According to a report by MarketsandMarkets, the optical networking market is expected to grow from $18.9 billion in 2020 to $34.6 billion by 2025, at a Compound Annual Growth Rate (CAGR) of 10.8% during the forecast period.
As stated by Alex, the founder of Ticker Symbol, “The best investment you can make is in you.”
Transceivers are the little plug-in modules that sit in a switch or in a server port to both transmit and receive data, which is why they’re called transceivers. They turn electrical signals from the chip into light at one end of the fiber, and then they turn that light back into electrical signals at the other end. Then, full optical systems and software stitch all those links together into complete networks. Lumentum, Coherent, and Sienna dominate different layers of this stack making them great ways to invest in the shift to optical now that networking is becoming the next major bottleneck for AI But while everyone focused on AI and chip stocks gold has quietly rallied by 50 in the last year alone.
Expert Opinions
According to Dan O’Flaherty, CEO of Versa Met Royalties, “We have an impressive track record, deploying over 400 million dollars across 28 royalty and metal streams so far, giving investors exposure to gold, silver, and copper across multiple mines on multiple continents, all with one ticker.”
The problem is, owning a single miner usually means a single team, digging metal out of a single hole in the ground. That’s where Versamet Royalties comes in, the sponsor of this video. running mines versa met finances them and collects a slice of every ounce produced through royalties and metal streaming contracts the higher gold and silver prices get the more each stream is worth versa met produced over 9 800 gold equivalent ounces in 2025 nearly double the year before and they’re guiding to over 20 000 ounces in 2026.
Frequently Asked Questions
What is optical networking?
Optical networking is a technology that uses light to transmit data through glass fibers, which can carry much more data over much longer distances with much lower losses and interference.
What are the benefits of optical networking?
The benefits of optical networking include higher bandwidth, lower latency, and lower power consumption compared to traditional copper-based networking.
What are the risks associated with investing in optical networking stocks?
The risks associated with investing in optical networking stocks include market volatility, competition from other technologies, and regulatory changes.
Which optical networking company is the best investment right now?
According to the video, Coherent is the best investment right now due to its vertical integration, six-inch indium phosphide wafer fabs, and multi-billion dollar investment and purchase agreement with Nvidia.
What is the outlook for the optical networking market?
The outlook for the optical networking market is positive, with the market expected to grow from $18.9 billion in 2020 to $34.6 billion by 2025, at a Compound Annual Growth Rate (CAGR) of 10.8% during the forecast period.
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