Changpeng Wan
Market Momentum: Optical Modules Fuel China’s Tech Rally
This past week witnessed a seismic shift in China’s tech landscape. As A-share indices climbed decisively – the Shanghai Composite rising 0.69%, Shenzhen Component surging 2.04%, and the ChiNext Index leaping 3.17% – one sector dramatically outperformed: optical modules. Driving this rally was New Fortress Technology (新易盛), whose stock skyrocketed nearly 40% following blockbuster earnings projections. The company’s explosive growth narrative attracted 139 institutional investors in just five days, signaling profound confidence in China’s positioning within the global AI infrastructure race.
Institutional Capital Floods Optical Module Leaders
Investment institutions are placing unprecedented bets on photonics-powered AI infrastructure:
Wind Data Reveals Research Frenzy
Throughout the week, 160 Chinese firms disclosed formal research disclosures, with optical module specialists dominating activity:
- – 70% of researched companies delivered positive weekly returns– New Fortress Tech led gainers at 39% growth– Six firms including Zhongji Innolight (中际旭创) surpassed 20% gains
Sector Catalyst: Explosive Earnings Revisions
Two dominant forces shaped institutional conviction:
- – Artificial intelligence compute demands accelerating worldwide– Major operators scaling data center investments rapidly
New Fortress Technology: Capacity Expansion Meets AI Demand
With 139 institutions seeking insights, New Fortress Tech detailed its growth strategy.
Record Earnings Projections
The company anticipates staggering H1 2025 results:
- – Net profit between 3.7B-4.2B yuan ($512M-$581M)– Year-over-year growth exceeding 327%– Revenue propelled by next-gen AI infrastructure deployments
Geographic Manufacturing Strategy
Key Thailand expansions signal production scaling:
- – Phase 2 capacity activated January 2025– Ongoing Thailand output increases meeting global demand– Flexible manufacturing adaptation to client orders
Zhongji Innolight: Riding the 800G Wave Toward 1.6T
Zhongji Innolight hosted 130 institutions as it detailed technology transitions.
Performance Acceleration Drivers
Interim guidance revealed powerful momentum:
- – Expected net profit of 3.6B-4.4B yuan ($517M-$615M)– Year-over-year expansion surpassing 52%– 800G module sales driving majority revenue gains
The Next Speed Frontier
Management outlined critical technology inflection points:
- – Significant Q4 2025 volume growth for 1.6T modules– Expanding rollout footprints among major cloud operators– Multi-generation roadmap securing long-term positioning
Robotics and Semiconductor Resurgence
Beyond optics, automation and chips drew concentrated interest.
Step's Robotics Ambitions
Step (新时达) detailed progress to 95 institutions:
- – 2025 humanoid robot platform development timeline– Strategic integration with Haier's industrial ecosystems– Digital solution stack combining edge and cloud capabilities
Wintech's Semiconductor Comeback
Following strong forecasts, Wintech (闻泰科技) met 84 institutions:
- – Q2 semiconductor revenue accelerating YoY and QoQ– Automotive-grade SiC module shipments starting Q3– Restructured leadership aligning with chip strategy
The Institutional Takeaway: China's Infrastructure Advantage
Three critical investment themes emerged:
- – Optical modules remain central to AI scaling, with China capturing production leadership– Module suppliers retain pricing power through technological transitions– Semiconductor activity trending upward amid inventory normalization
The outsized institutional presence confirms structural confidence in optical module fundamentals. For investors, focus shifts toward execution monitoring – specifically Thailand capacity ramp rates, 1.6T qualification timeframes, and automotive chip design wins. Companies translating research enthusiasm into shipment conversions will deliver the next alpha generation.
