Applied Optoelectronics, Inc.

ao-inc.com

What Do They Do?

Designs and manufactures fiber-optic networking products, including optical transceivers and CATV network equipment, for data center operators, cable companies and network equipment makers.

How Do They Make Money?

Customers pay mainly for fiber-optic networking products, generally when the products ship or are delivered. For engineering services, customers pay over the course of the work, based on time spent or project milestones.

revenue

Segment	Share	How money arrives
CATV Sold outright	54% FY2022: 53%	Sold outright
Data Center Sold outright	43% FY2022: 35%	Sold outright
Telecom Sold outright	3.0% FY2022: 11%	Sold outright
FTTH and Other Sold outright	0.3%	Sold outright

Who Are Their Customers?

Data center operators and CATV and telecom equipment makers buy the products. AOI sells directly in North America and uses both direct sales and sales partners elsewhere; partners provide logistics and customer support.

Customers above 10% of revenue, FY2025

of revenue from two customers (53%, 29%)

FY2024: 91% from three customers

Do Revenues Turn Into Profits?

No. It lost $38.2M in FY2025.

Operating income, FY2025

−12% of revenue

▼ −23% (Loss) vs FY2024 (−$70.9M, −28%)

Net income, FY2025

−8% of revenue

▼ −80% (Loss) vs FY2024 (−$186.7M, −75%)

Free cash flow, FY2025

−78% of revenue

▲ +213% (Loss) vs FY2024 (−$112.9M, −45%)

How Are They Changing?

Since the FY2025 annual report

Latest quarter: Q2 FY2026, the three months to Jun 30, 2026

Revenue: ▲ +86%; vs $103M in Q2 FY2025
Net income: ▲ +150% (Loss); vs −$9.1M in Q2 FY2025

CATV share of revenue vs 54.4% in Q2 FY2025

Aug 6, 2026 Forecasts third-quarter revenue and non-GAAP profit The company expects third-quarter revenue of $255 million to $290 million and non-GAAP net income of $10.1 million to $24.0 million.

Growing. Revenue grew 2.2x in 4 years, from $211.6M in FY2021 to $455.7M in FY2025, about 21% a year.

Direct sales to cable operators The latest report says AOI began offering many CATV products directly to cable operators under its Quantum Bandwidth brand; the older report described sales to CATV equipment vendors and did not describe this direct offering.

Expanded data center customer group The older report described data center operators as the customers for optical transceivers; the latest report also identifies equipment suppliers that sell AOI products along with their own to hyperscale operators.

Revenue over time

CATV Data Center Telecom FTTH and Other FTTH Product and Service, Other

$500M$250M$0

FY2021 FY2022 FY2023 FY2024 FY2025

Who Do They Compete With?

Competes with Coherent, Eoptolink Technology, Foxconn Interconnect Technology, InnoLight Technology (Suzhou), Intel, Lumentum Holdings, Mitsubishi, Molex, Source Photonics, and Sumitomo Electric Industries

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