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Applied Optoelectronics (AAOI) Just Soared 15.6% — This Company May Hold The Reason

Applied Optoelectronics Inc. (NASDAQ:AAOI) is on the AI Stocks Dominating List of Biggest Winners.

Applied Optoelectronics bounced back by 15.6 percent on Wednesday to end at $55.86 apiece, amid renewed optimism for AI-related stocks, thanks to the strong performance of one of its peers.

In its updated report, data center operator CoreWeave Inc. said that revenues for the third quarter of the year climbed by 168 percent to $3.66 billion from only $1.36 billion in the same period last year, on the back of customer wins across AI labs, hyperscalers, and enterprises, namely Canva, Mirendil, Parallel Web Systems, Serve Robotics, Substack, and Wayve, among others. As of the end of September, its revenue backlog stood at $132.5 billion.

Photo by Tima Miroshnichenko on Pexels

The latest results signaled AI infrastructure spending remained strong, even as markets turned increasingly cautious amid the sustainability of AI infrastructure buildout.

For its part, Applied Optoelectronics Inc. earlier this month also reported strong earnings performance, booking a net income of $6.3 million, a reversal of the $17.9 million net loss in the same period last year.

Revenues surged by 127 percent to $269.9 million from $118.6 million year-on-year, driven by robust demand and manufacturing expansion in both its data center and CATV businesses.

Further supporting optimism were plans to double its manufacturing expansion of 800G and 1.6T transceivers by the end of 2027, although there was a pushback from its original target date due to longer-than-expected time to obtain necessary electrical power, among other construction-related issues.

“We remain focused on executing on our capacity expansion plans and believe we are well positioned to support the next phase of AI data center deployment,” Applied Optoelectronics Inc. Chief Finance and Strategy Officer Stefan Murry said.

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