Deutsche Bank Names 2 Stocks for AI's Next Wave

NVIDIA CEO Jensen Huang highlighted memory and silicon photonics as AI bottlenecks, with Micron, Coherent, and Tower Semiconductor positioned to benefit. Micron leads in high-bandwidth memory, Coherent supplies photonics components, and Tower Semiconductor manufactures wafers. NVIDIA expects 70% revenue growth, and analysts note supply constraints and pricing power in these sectors.

Coherent Corp (COHR) unveiled PhotonLink at ECOC 2026, a platform for AI data center optical connections. The company estimates a $30B market opportunity by 2030, adding to its $60B portfolio. COHR has customer engagements with NVIDIA and plans deployment from Q4 2026 to 2030. Shares surged 19% post-announcement, with 191% return over the past year. COHR operates four wafer fabs and has shipped over 650M optical components.

Corning (GLW) rose 6%, outpacing Lumentum (LITE) at 4%, after a joint AI optical interconnect demo. Applied Optoelectronics (AAOI) and Coherent (COHR) also gained 4%. The Roundhill Photonics ETF (LYTE) rose 3%. Corning's diversification cushions AI optical downside but dilutes revenue impact. Analysts note the demo may signal broader AI optical demand.

Coherent Corp. (COHR) stock rose 4.82% to $332.66 after introducing new optical technologies for AI infrastructure, including a 6.4T optical engine and 3.2T transceiver. The company will showcase these advancements at the ECOC 2026 conference, targeting high-density networks and datacenter connectivity. Coherent's portfolio expansion aims to address rising bandwidth and power demands in AI infrastructure.

Lumentum's stock rose 5.4% after showcasing a high-density optical interconnect system with Qualcomm and Corning at the ECOC 2026. Analysts from Deutsche Bank and Evercore ISI initiated coverage with bullish ratings. The broader market also gained, with the NASDAQ up 1.5% and S&P 500 up 0.9%.

Lumentum, Qualcomm, and Corning announced a joint demonstration of high-density optical interconnect technology for AI architectures. The collaboration combines Qualcomm's interface IP, Lumentum's optical platform, and Corning's fiber connectivity. In premarket trading, Corning shares rose 3%, Lumentum gained 2.4%, and Qualcomm added 1.3%.