In this article, we look at the 10 Best Fiber Optics Stocks to Buy for the AI Data Center Boom.
AI data centers are putting unusual pressure on the optical networking supply chain, not because fiber is new, but because large AI clusters need far more bandwidth between accelerators, switches, racks, and data center campuses. Dell’Oro Group’s May 2026 outlook provides a current marker for the trend: the firm expects the optical transport equipment market to grow 16% in 2026 and exceed $18 billion in manufacturer revenue for the first time since 2000, following an estimated 20% year-over-year market growth in the first quarter of 2026. Dell’Oro also estimated that revenue tied to direct purchases for data center interconnect grew 40% year-over-year in Q1 2026.
The optical component side is showing a similar pattern. LightCounting’s April 2026 forecast said the Ethernet transceiver market grew 93% in 2024 and an estimated 82% in 2025, with another 65% growth forecast for 2026. The firm also expects AI cluster connectivity to support demand for faster, longer-reach optical modules that can move large amounts of data between data centers and across dense AI campuses. The setup remains cyclical, with risks from accelerator supply, laser-chip capacity, customer inventory, and cloud capital spending, but the AI bandwidth problem is making optical connectivity a larger part of data center expansion.
Methodology
For this article, we screened companies with meaningful exposure to fiber optics, optical networking, optical components, high-speed interconnects, and related AI data center infrastructure. We then ranked the stocks by the number of hedge fund holders holding stakes in them as of Q1 2026.
Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Insider Monkey’s quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 599.2% since May 2014, beating its benchmark by 372 percentage points (see more details here).
10. Prysmian S.p.A. (OTC:PRYMY)
Number of Hedge Fund Holders: N/A
Prysmian S.p.A. (OTC:PRYMY) is one of the Best Fiber Optics Stocks to Buy for the AI Data Center Boom. On June 2, 2026, Jefferies raised its price target on Prysmian to €176, citing rising demand for optical fiber infrastructure tied to AI data centers. The firm pointed to Prysmian’s Digital Solutions unit as a key growth driver and forecast the segment’s revenue to grow at an annual rate of about 20% from 2026 to 2030, roughly doubling over that period.
The thesis fits the fiber optics theme more cleanly than broad connector or chip names because Prysmian is directly exposed to the physical cable layer. Its own May 13, 2026, discussion of AI fiber network design said AI data centers require dense, reliable optical infrastructure, including bend-insensitive single-mode fiber, ultra-high-count ribbon cables, and emerging hollow-core fiber that could extend the reach and speed of links between data centers.
Prysmian S.p.A. (OTC:PRYMY) is a global cable and systems company serving energy, telecom, broadband, data center, and industrial markets. Its digital solutions portfolio includes optical fiber, fiber-optic cable, connectivity products, and high-density network infrastructure used in data centers and communications networks.
9. MACOM Technology Solutions Holdings, Inc. (NASDAQ:MTSI)
Number of Hedge Fund Holders: 45
MACOM Technology Solutions Holdings, Inc. (NASDAQ:MTSI) is one of the Best Fiber Optics Stocks to Buy for the AI Data Center Boom. On June 8, 2026, MACOM introduced its hot via chip scale technology, a packaging process built on AlGaAs diode technology that eliminates traditional wire bonds. The product detail is technical, but the investor angle is straightforward: as AI networks move toward faster optical and high-frequency links, component makers need packaging that can preserve signal quality while reducing assembly complexity.
MACOM said the process routes RF signal and ground paths vertically through the die, simplifying surface-mount assembly, reducing parasitics, improving manufacturing consistency, and supporting reliable performance into millimeter-wave frequencies. Its first product using the process is the MASW-011261, a broadband SP2T switch operating from 60 to 110 GHz, with 0.9 dB typical insertion loss, 30 dB isolation, and sub-20 ns switching. The release reinforces MACOM’s position in high-speed semiconductor components used across optical networking and data-center infrastructure.
MACOM Technology Solutions Holdings, Inc. (NASDAQ:MTSI) designs and manufactures semiconductor products for telecommunications, industrial, defense, and data center applications. Its portfolio includes RF, microwave, analog, mixed-signal, optical, photonic, and networking semiconductor products.
8. Applied Optoelectronics, Inc. (NASDAQ:AAOI)
Number of Hedge Fund Holders: 55
Applied Optoelectronics, Inc. (NASDAQ:AAOI) is one of the Best Fiber Optics Stocks to Buy for the AI Data Center Boom. On May 12, 2026, the company said it was working with Mediacom to accelerate DOCSIS 4.0 network upgrades and the expansion of fiber and coax infrastructure across the cable operator’s footprint. The project is not an AI data center order, but it highlights Applied Optoelectronics’ role in advanced optical and hybrid fiber-coax networking hardware, which sits close to the same bandwidth problem driving AI infrastructure spending.
Mediacom plans to upgrade its network to serve about 1 million homes by the end of 2026 using distributed access architecture, DOCSIS 4.0, fiber expansion, and whole-home Wi-Fi technology. Applied Optoelectronics is the primary vendor for Mediacom’s upgrades across legacy amplifier holdings, supplying 1.8GHz smart amplifiers and related software meant to increase capacity, improve signal quality, and lower operating costs.
Applied Optoelectronics, Inc. (NASDAQ:AAOI) develops and manufactures advanced optical and HFC networking products for AI data centers, CATV broadband, telecom, and fiber-to-the-home markets. Its portfolio includes optical transceivers, lasers, amplifiers, broadband access products, and related components.
7. Credo Technology Group Holding Ltd. (NASDAQ:CRDO)
Number of Hedge Fund Holders: 59
Credo Technology Group Holding Ltd. (NASDAQ:CRDO) is one of the Best Fiber Optics Stocks to Buy for the AI Data Center Boom. On June 1, 2026, the company reported fourth-quarter fiscal 2026 revenue of $437.0 million, up 157.0% year over year, and full-year revenue of $1.3 billion, more than triple the prior year. The numbers fit the AI data center angle because management tied the growth to its high-speed connectivity portfolio, which is used to improve cluster stability, GPU utilization, network reliability, and power efficiency.
Credo also guided for first-quarter fiscal 2027 revenue of $465 million to $475 million, implying the ramp was expected to continue beyond the fiscal-year close. The release highlighted high-speed copper and optical interconnect products operating at up to 1.6T, including optical transceivers, retimers, and DSPs for optical and copper Ethernet and PCIe, giving the company direct exposure to the bandwidth needs of large AI infrastructure builds.
Credo Technology Group Holding Ltd. (NASDAQ:CRDO) provides high-speed connectivity solutions for data infrastructure. Its portfolio includes active electrical cables, optical transceivers, retimers, DSPs, and software used in AI, Ethernet, PCIe, and cloud networking applications.
6. Ciena Corporation (NYSE:CIEN)
Number of Hedge Fund Holders: 73
Ciena Corporation (NYSE:CIEN) is one of the Best Fiber Optics Stocks to Buy for the AI Data Center Boom. On June 4, 2026, Ciena reported fiscal second-quarter revenue of $1.57 billion, up 40% year over year, and raised its fiscal 2026 revenue outlook to $6.3 billion, plus or minus $100 million, implying 32% growth at the midpoint. The optics-specific data point was the mix: Networking Platforms generated $1.27 billion, or 81.1% of revenue, while Optical Networking alone contributed $1.10 billion.
CEO Gary Smith tied the quarter to Ciena’s strategy across wide-area networks and “in and around the data center,” saying it was aligned with multi-year opportunities created by AI-driven demand. The company also guided fiscal third-quarter revenue to $1.625 billion, plus or minus $50 million. That keeps the story focused on AI bandwidth needs, where fiber, optical systems, and interconnects are becoming more important beyond the GPU layer as operators upgrade high-speed links.
Ciena Corporation (NYSE:CIEN) provides high-speed networking systems, software, and services for communications service providers, cloud operators, governments, and enterprises. Its portfolio includes optical networking platforms, routing and switching products, automation software, and data center interconnect solutions.
While we acknowledge the potential of CIEN to grow, our conviction lies in the belief that some other AI stocks hold greater promise for delivering higher returns and have limited downside risk. If you are looking for an AI stock that is more promising than CIEN and that has 100x upside potential, check out our report about the cheapest AI stock.
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