Applied Optoelectronics Q2: Demand is 20% to 40% Above an Already-Aggressive Ramp

Applied Optoelectronics delivered its fifth consecutive quarter of record revenue in Q2, however, the more important story is what lies ahead. Management shared details on a very steep 800G and 1.6T ramp with production capacity expected to rise from 200K units per month to 650K units per month by year-end. The company expects Q3 revenue to increase roughly 42% QoQ at the midpoint, with nearly all of the growth coming from 800G. Management also indicated that Q4 revenue could exceed $500 million, compared to current analyst estimates of $410 million. From there, as we look into 2027, 1.6T is expected to become a meaningful growth driver alongside continued strength in 800G growth.