Data Centers Need Faster Connections. These 6 Optical and Networking Stocks Could Benefit.
Six companies are highlighted for their roles in providing high-speed connections for AI data centers. Credo Technology (CRDO) reported $479M revenue in Q1 2027, up 114% YoY. Astera Labs (ALAB) saw revenue more than double in Q2 2026. Arista Networks (ANET) introduced a 1.6Tbps platform. Coherent (COHR) and Lumentum (LITE) focus on optical connectivity, with Lumentum's revenue up 83% in fiscal 2026. Marvell Technology (MRVL) designs semiconductors for high-speed data travel.
How this was made
The 30-second read
Why it matters
The highlighted companies are positioned to capture a multi‑year shift toward high‑bandwidth data‑center interconnects.
Market read
These firms stand to benefit from the AI data‑center bandwidth surge, making them potential short‑term trade ideas.
What to watch
Supply‑chain constraints or competition from integrated silicon providers could temper upside.
Background
AI model training requires massive data movement; faster optical and networking solutions are critical to avoid bottlenecks.
Ticker impact
Credo reported Q1 fiscal 2027 revenue of $479M, up 114% YoY, indicating strong demand for its optical DSPs.
likely upside as investors price in faster growth trajectory
Double‑digit revenue growth and market need for AI‑grade connectivity support a bullish view.
Astera Labs saw Q2 2026 revenue more than double year‑over‑year, driven by its Scorpio fabric switches.
potential upward pressure from continued revenue acceleration
Rapid revenue expansion signals market share gains in AI infrastructure.
Arista introduced its 7060XE7 platform supporting 1.6 Tbps links, expanding its high‑speed Ethernet portfolio.
moderate upside as customers adopt the latest switches
Product launch aligns with growing AI data‑center demand.
Coherent highlighted its photonic portfolio as AI data‑centers shift from copper to fiber optics.
gradual upside as fiber adoption rises
Management’s view ties directly to secular AI infrastructure trends.
Lumentum reported FY 2026 revenue of $3.01B, up 83%, driven by high‑speed optical links for GPU clusters.
likely upward pressure from robust earnings
Substantial revenue increase reflects expanding market for optical data paths.
Marvell designs high‑speed transceivers and Ethernet processors for data‑center interconnects.
potential modest upside as AI traffic grows
Exposure to AI‑driven connectivity demand supports a favorable outlook.
Market effects
Accelerated demand for high‑speed optical and networking components across AI data‑centers.
U.S. semiconductor and networking sectors may see increased buying pressure.
Global AI infrastructure rollout benefits vendors worldwide.
Counterpoint
Rapid revenue growth may already be priced in; valuation could be stretched.
Key entities
- CompanyCredo Technology
Optical DSP and cable maker
- CompanyAstera Labs
AI rack connectivity provider
- CompanyArista Networks
High‑speed Ethernet switch vendor
- CompanyCoherent
Laser and photonic equipment supplier
- CompanyLumentum
Optical link manufacturer
