Positive Outlook for Datacom Market Growth
Written by Emily J. Thompson, Senior Investment Analyst
Updated: 43 minutes ago
0mins
Should l Buy COHR?
Source: seekingalpha
- Market Growth Forecast: LightCounting has recently revised the datacom market outlook upwards, with expectations for the market to expand at nearly a 35% CAGR through 2028, growing from $19 billion in 2025 to $47 billion by 2028, indicating strong market demand and investment opportunities.
- Data Rate Drivers: Analysts noted that the 1.6T data rate market is expected to grow at approximately 200% CAGR to $21 billion, while the 800G rate is projected to grow at nearly 26% CAGR to $21 billion, highlighting the rapidly increasing demand for high data rate products.
- Increasing Optical Attach Rates: The optical attach rate is forecasted to rise from less than four times in 2025 to 4.5 times by 2027, indicating a growing application of optical components across various processing units, particularly in different architectures used by Google and Nvidia.
- Significant Market Potential: The total addressable market for co-packaged optics is projected to reach $2 billion by 2028 and surge to $11 billion by 2030, suggesting that the growth potential in this area far exceeds conservative estimates from industry analysts, which could significantly boost revenues for related companies.
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Analyst Views on COHR
Wall Street analysts forecast COHR stock price to fall
13 Analyst Rating
9 Buy
4 Hold
0 Sell
Moderate Buy
Current: 404.940
Low
170.00
Averages
238.18
High
300.00
Current: 404.940
Low
170.00
Averages
238.18
High
300.00
About COHR
Coherent Corp. is a vertically integrated manufacturing company that develops, manufactures, and markets lasers, transceivers, and other optical and optoelectronic devices, modules, and systems, as well as engineered materials, for use in the communications, industrial, instrumentation and electronics markets. Its segments include datacenter & communications, and industrial. Its datacenter & communications segment offers optical transceivers, optical circuit switches, interconnect cables, optical instruments, optoelectronic devices, communication components, and wavelength management products. Its industrial segment offers lasers, machines & systems, components & accessories, optics, laser measurement instruments, ceramics & metal matrix, ion implantation, engineered materials, and wide-bandgap electronics. Its subsidiaries include Finisar Australia Pty Limited, Nufibre PTY LTD, Finisar Brasil Suporte De Vendas LTDA, Coherent Aerospace & Defense, Inc., and Coherent Asia, Inc.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
Positive Outlook for Datacom Market Growth
- Market Growth Forecast: LightCounting has recently revised the datacom market outlook upwards, with expectations for the market to expand at nearly a 35% CAGR through 2028, growing from $19 billion in 2025 to $47 billion by 2028, indicating strong market demand and investment opportunities.
- Data Rate Drivers: Analysts noted that the 1.6T data rate market is expected to grow at approximately 200% CAGR to $21 billion, while the 800G rate is projected to grow at nearly 26% CAGR to $21 billion, highlighting the rapidly increasing demand for high data rate products.
- Increasing Optical Attach Rates: The optical attach rate is forecasted to rise from less than four times in 2025 to 4.5 times by 2027, indicating a growing application of optical components across various processing units, particularly in different architectures used by Google and Nvidia.
- Significant Market Potential: The total addressable market for co-packaged optics is projected to reach $2 billion by 2028 and surge to $11 billion by 2030, suggesting that the growth potential in this area far exceeds conservative estimates from industry analysts, which could significantly boost revenues for related companies.
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- High-Level US-China Meeting: The meeting between US President Trump and Chinese President Xi Jinping highlighted tech cooperation, with executives from Nvidia, Tesla, and Apple present, indicating a strong American interest in the Chinese market.
- Absence of Chip Export Controls: Despite Nvidia CEO Jensen Huang's presence, discussions on chip export controls were notably absent, which could impact the sales of Nvidia's H200 chips in China, reflecting the complexities of US-China relations in high-tech sectors.
- Rare Earth Minerals Negotiations: Both sides expressed a willingness to cooperate on access to rare earth minerals, where China holds a dominant market position, with hopes to extend existing trade agreements to ensure the US secures critical resources and enhances supply chain resilience.
- Future Negotiation Outlook: Ongoing negotiations on sensitive topics like rare earth minerals are expected to continue into the summer, and if Xi visits the US in September, these issues may resurface, highlighting potential opportunities for economic collaboration between the two nations.
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Trump-Xi Talks Omit Chip Export Controls, Focus on Minerals
- Meeting Overview: The Trump-Xi talks did not address chip export controls, although critical minerals and market access for U.S. tech companies were expected focal points, indicating ongoing tensions in the tech sector between the two nations.
- U.S. Executive Participation: High-profile executives including Nvidia's Jensen Huang, Tesla's Elon Musk, and Apple's Tim Cook were part of the U.S. delegation, reflecting America's interest in the Chinese market, yet the lack of consensus on chip exports may hinder future collaboration opportunities.
- Rare Earth Minerals Issue: China's dominance over critical and rare earth minerals remains a sensitive topic in U.S.-China relations; while the U.S. has seen improvements in accessing these resources, uncertainty over the extension of future agreements could impact America's competitiveness in high-tech industries.
- Market Reaction Expectations: Despite the absence of concrete agreements, President Xi's statement about further opening China's market may provide opportunities for U.S. businesses, but the practical implications remain to be seen, potentially affecting market confidence in future collaborations.
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- Akamai Stock Surge: Akamai Technologies saw its shares jump nearly 7% after Bank of America upgraded its rating to buy and raised its price target from $130 to $175, reflecting a strategic shift towards becoming a credible AI infrastructure platform.
- Nebius Revenue Surge: Nebius reported $399 million in revenue for Q1, marking a staggering 684% increase year-over-year, and announced securing up to 1.2 gigawatts of power and land for a new AI factory in Pennsylvania, driven by rising demand for cloud and GPU capacity.
- Alibaba Cloud Performance: Alibaba's U.S.-listed shares rose 6% following a 38% year-over-year revenue increase in its cloud computing unit for Q1, alongside significant investments in artificial intelligence, reinforcing its competitive position in the market.
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- Alibaba Profit Plunge: Alibaba's U.S.-listed shares fell 3% after reporting an 84% drop in Q1 profit, indicating severe short-term profitability challenges despite heavy investments in AI, which may hinder its future market performance.
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- New Product Launch: The company has introduced nine new 2X single-stock leveraged ETFs designed to provide active traders with dynamic investment tools to amplify returns in high-growth innovative companies, which is expected to attract more investors seeking high-risk, high-reward opportunities.
- Market Positioning: These newly launched ETFs are tailored for investors seeking 200% exposure to daily performance, offering efficient market participation tools that are likely to enhance investor capabilities in technology and industrial sectors, thereby driving market share growth for the company.
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Positive Outlook for Datacom Market Growth
- Market Growth Forecast: LightCounting has recently revised the datacom market outlook upwards, with expectations for the market to expand at nearly a 35% CAGR through 2028, growing from $19 billion in 2025 to $47 billion by 2028, indicating strong market demand and investment opportunities.
- Data Rate Drivers: Analysts noted that the 1.6T data rate market is expected to grow at approximately 200% CAGR to $21 billion, while the 800G rate is projected to grow at nearly 26% CAGR to $21 billion, highlighting the rapidly increasing demand for high data rate products.
- Increasing Optical Attach Rates: The optical attach rate is forecasted to rise from less than four times in 2025 to 4.5 times by 2027, indicating a growing application of optical components across various processing units, particularly in different architectures used by Google and Nvidia.
- Significant Market Potential: The total addressable market for co-packaged optics is projected to reach $2 billion by 2028 and surge to $11 billion by 2030, suggesting that the growth potential in this area far exceeds conservative estimates from industry analysts, which could significantly boost revenues for related companies.
See More
US-China Executive Meeting Focuses on Tech Cooperation
- High-Level US-China Meeting: The meeting between US President Trump and Chinese President Xi Jinping highlighted tech cooperation, with executives from Nvidia, Tesla, and Apple present, indicating a strong American interest in the Chinese market.
- Absence of Chip Export Controls: Despite Nvidia CEO Jensen Huang's presence, discussions on chip export controls were notably absent, which could impact the sales of Nvidia's H200 chips in China, reflecting the complexities of US-China relations in high-tech sectors.
- Rare Earth Minerals Negotiations: Both sides expressed a willingness to cooperate on access to rare earth minerals, where China holds a dominant market position, with hopes to extend existing trade agreements to ensure the US secures critical resources and enhances supply chain resilience.
- Future Negotiation Outlook: Ongoing negotiations on sensitive topics like rare earth minerals are expected to continue into the summer, and if Xi visits the US in September, these issues may resurface, highlighting potential opportunities for economic collaboration between the two nations.
See More
Trump-Xi Talks Omit Chip Export Controls, Focus on Minerals
- Meeting Overview: The Trump-Xi talks did not address chip export controls, although critical minerals and market access for U.S. tech companies were expected focal points, indicating ongoing tensions in the tech sector between the two nations.
- U.S. Executive Participation: High-profile executives including Nvidia's Jensen Huang, Tesla's Elon Musk, and Apple's Tim Cook were part of the U.S. delegation, reflecting America's interest in the Chinese market, yet the lack of consensus on chip exports may hinder future collaboration opportunities.
- Rare Earth Minerals Issue: China's dominance over critical and rare earth minerals remains a sensitive topic in U.S.-China relations; while the U.S. has seen improvements in accessing these resources, uncertainty over the extension of future agreements could impact America's competitiveness in high-tech industries.
- Market Reaction Expectations: Despite the absence of concrete agreements, President Xi's statement about further opening China's market may provide opportunities for U.S. businesses, but the practical implications remain to be seen, potentially affecting market confidence in future collaborations.
See More
Semiconductor Stocks Rally, Alibaba Cloud Revenue Soars
- Semiconductor Stocks Rally: Shares of Micron Technology rose about 3% as investors bought back into the semiconductor sector, with the VanEck Semiconductor ETF (SMH) increasing over 1%, indicating a resurgence of confidence in the industry.
- Akamai Stock Surge: Akamai Technologies saw its shares jump nearly 7% after Bank of America upgraded its rating to buy and raised its price target from $130 to $175, reflecting a strategic shift towards becoming a credible AI infrastructure platform.
- Nebius Revenue Surge: Nebius reported $399 million in revenue for Q1, marking a staggering 684% increase year-over-year, and announced securing up to 1.2 gigawatts of power and land for a new AI factory in Pennsylvania, driven by rising demand for cloud and GPU capacity.
- Alibaba Cloud Performance: Alibaba's U.S.-listed shares rose 6% following a 38% year-over-year revenue increase in its cloud computing unit for Q1, alongside significant investments in artificial intelligence, reinforcing its competitive position in the market.
See More
EchoStar Gains FCC Approval, Shares Rise
- EchoStar Stock Surge: EchoStar's shares rose nearly 4.5% following the FCC's approval of its $40 billion sale of wireless spectrum to AT&T and SpaceX, which is expected to significantly enhance the company's financial position and market competitiveness.
- Alibaba Profit Plunge: Alibaba's U.S.-listed shares fell 3% after reporting an 84% drop in Q1 profit, indicating severe short-term profitability challenges despite heavy investments in AI, which may hinder its future market performance.
- Nextpower Revenue Guidance Upgraded: Nextpower raised its full-year revenue guidance to a range of $3.8 billion to $4.1 billion, up from $3.6 billion to $3.8 billion, resulting in a 14% stock surge that reflects the company's strong growth potential in the energy sector.
- Resideo Earnings Guidance Miss: Resideo's shares plunged nearly 9% after guiding for current-quarter adjusted earnings between 71 to 75 cents per share, below the analyst expectation of 84 cents, despite beating first-quarter estimates, indicating potential investor concerns about future performance.
See More
Themes ETF Trust Launches Nine New 2X Leveraged ETFs
- Management Fee Update: Themes ETF Trust has revised the management fee from 0.35% to 0.75% in its latest announcement, aiming to enhance investor confidence in the new products while ensuring profitability in a competitive ETF market.
- New Product Launch: The company has introduced nine new 2X single-stock leveraged ETFs designed to provide active traders with dynamic investment tools to amplify returns in high-growth innovative companies, which is expected to attract more investors seeking high-risk, high-reward opportunities.
- Market Positioning: These newly launched ETFs are tailored for investors seeking 200% exposure to daily performance, offering efficient market participation tools that are likely to enhance investor capabilities in technology and industrial sectors, thereby driving market share growth for the company.
- Strategic Expansion: The launch of these ETF products not only enriches the product line of Themes ETF Trust but also demonstrates its commitment to high-conviction single-stock trading strategies, which is expected to further elevate the company's market position in the ETF industry.
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