AVGOBroadcom Inc
2Bull0Bear11Mention
Serenity @aleabitoreddit
Focused on AI photonics and semiconductor supply chains — sourcing asymmetric setups from bottoms-up value-chain research. Tracks CPO & optical modules closely, with ongoing deep-dives on SIVE, AAOI, LITE, POET.
Quick verdict
AVGO is net bullish (2 bull · 0 bear)
Broadcom's bottom line will increase, but its relative benefit from growing demand will be significantly less than other supply chain players.
Last spoke: 08/18/2026, 14:03 · conviction 4/10
8-10 confidence views use larger markers▲ Bull▼ Bear● Mention
View History (13, newest first)
- The AI semi theme is down if you look at $AVGO to $TSM. Higher beta names seem to have been hit the hardest. From trends I've seen with optical names, $LITE / $COHR recovered fastest, then larger still high beta names like $AAOI / $AXTI (halfway). Then your $SIVE / $POET type names have taken the longest. But I do see a sharper recovery when markets are more risk-on or when earnings forces re-ratings.
- As for names Jensen / Nvidia directly invested in: - $MRVL (Celestial), $LITE, $COHR for photonics... - $CCXI (Agility) for humanoids. I tend to do more complex investing, for my own thought process: -> I know CPO theme is coming next -> Nvidia secures all CW laser capacity. -> Maybe, $AAOI, $MTSI, $AVGO, $SIVE, $SMTC are remaining CW western players. -> $SIVE probably the highest-beta exposure. SO that was my personal long. Can probably do something similar for the other themes.
- Just some TLDR notes on $AAOI earnings: - Expects full qualification of 1.6T products by their hyperscaler customer within next couple of weeks (helpful revenue ramp #2, timelines) - Continues to believe that AOI will have the largest AI DC transceiver production capacity in the US (reiterating ambitions during a time when their competitors might get banned) - Expects facilities toward InP capacity to come online in early 2027 (timeline FYI in terms of further ramp) - Total capacity is approaching 200,000/u per month, EOY 650,000/u per month of 800g/1.6t. EOY 2027, 930,000/u (this is the ramp i want to see) - "increase our manufacturing capacity for our external light source or ELSFP. That's for co-packaged optics or CPO". we anticipate ramping production later this year and into 2027, ultimately culminating in about 400,000 pieces per month in 2028 (need some time to model this into revenue) - "As we have mentioned before, we've been manufacturing lasers internally for many years. This has allowed us to avoid some of the shortages that have affected others in the industry" (vertical integration bull case during CW/EML laser shortages) - We believe that in the future, CPO will continue to drive increased demand for high-power lasers (thesis validation on CPO sector) - "to our long-term objective of returning non-GAAP gross margins to around 40%" - "We ended the second quarter with $508.8 million in total cash equivalents" I need to double check if the ATM finished or not - "our ability to deliver revenue in general, and specifically when it comes to 800G products, is limited by our production capacity right now" "If we could produce more, we could ship more right now" Demand > Supply validation. - "Most of the increased capacity will be in U.S. Even so, let me say that, like I keep emphasizing, that is not good enough for the customer demand. The customer demand is 20%-40% higher." Unholy photonics demand validation across the whole sector, read through for $LITE, $SIVE / $JBL, and others is amazing. - "Not in the next two, three years, especially the demand is so big. Okay? Even combined AI, $LITE, $COHR, $AVGO all together, it's still very tough to meet the customer demand in the next few years" More optical sector demand validation. - CPO Timelines: "If you're talking about really high volume manufacturer [for CPO market], I would say more like the late Q3 next year" and "We have been working very close with at least five customer" If you care about current earnings (which I'm not really looking at closely) Revenue: $191M vs. $190m EPS: $.06 vs. $.02 TLDR: Extraordinary demand across the laser + optical sector read through. Kinda supporting Lumentum CEO statement that laser shortage is worse than memory shortages. 2027 capacity ramp on track. To map inflection period with timelines, would be around early next year, as stated in their previous earnings call. AAOI has the customers now. Limitation is making enough lasers and transceivers.
- It's slightly more nuanced. Basically, $AMD SF event is tomorrow, Wed/Thurs (July 22, 23). From Jefferies client note, AMD is expected to provide additional disclosures around their likely scale-up CPO roadmap + MI500. If they confirm CPO route, would positive thematically since it's not just $NVDA forcing the transition. As for $SIVE, we'll get a better read if they're directly in AMD supply chains. Since right now, it's possible to map it through $GFS (reportedly involved in AMD MI500 CPO work) or AYAR (which AMD invested in). But no formal confirmations. So if you're turning in: - CPO thematic positive: MI500 explicitly commits to CPO/optical UALink. - AMD gives details using Ayar Labs or GF SCALE for MI500 CPO: That would be extremely positive for $SIVE, given they're the upstream laser supplier / reference laser. Currently, Blayne Curtis from Jefferies expect AMD to work with $ALAB on UAL and $AVGO on ESUN... but juicy details are here: "We are looking for whether AMD commits to a CPO based scale up solution and who supplies the optical engine" We'll get a broader read through on the supply chain come Wednesday/Thursday, too early to tell today.
- Just very helpful timelines reiterated around glass substrate (source: Trendforce): - SKC Absolics (011790) H2 2026 (first mover x $AMAT) - $AMD customers - Samsung electromechanics h2 2027 (009150) x Sumitomo Chem (4005) - Apple / $AVGO / hyperscalers Idk about $INTC 2030 reports, we’ll see. $TSM CoPoS was 2-3Y was correct though from recent TSM chairman comments. Innolux was interesting beneficiary. $SHMD should be too off TSM but financials were pretty toxic. Same players should appear multiple times, eg innolux + SKC. Also applies to $LPK and upstream equipment seller around these ramps.
- Fun times with market corrections. Leaders from $NVDA down -4.87% to $MU down -7.03%. High beta names like $PL down -22.02%. Funny to see media always trying to explain like: "Micron suffers record wipeout as Broadcom casts a shadow over chip stocks " Broadcom projected insatiable demand into 2028, just made up narratives. Nothing's changed the AI buildout aside from increasing capex. Main material thing was rate hike probabilities increase. But you have random ones like these few times a year into ATHs. Personally wouldn't try and trade fed decision probabilities and stay long on current company projections (eg. $AAOI $471m h1 2027)
- $SIVE looks like both a chokepoint and a bottleneck for CPO next year. Keep seeing information published from nontechnical people who miss any nuances. Here’s the reason why: 1. CW lasers are bottlenecked signaled by $LITE earnings. Laser fabs are heavily allocated to EML likely from former $NVDA contracts. -> Sumitomo/Furukawa = bottleneck -> Win Semi = bottleneck $SIVE does fab-lite, so are they a bottleneck? Yes, $SIVE sits in the laser bottleneck since control output supply of CW lasers from Win Semi and other fabs from allocation way early on (CEO stated they working with more capacity from other players as well). Perfect example is Kioxia/Sandisk. $SNDK controls NAND output, so they’re a bottleneck because they control final pricing. Demand exceeding supply from Ayar, Jabil, other pluggable vendors + Nvidia NVLink CPO ecosystem… final laser supply owned by $SIVE makes Sivers a bottleneck. $SIVE is also likely primary/sole source for Jabil, Gen-1 Ayar, $MRVL Celestial, and other hyperscaler asic/merchant CPO routes. So no way to get around it (can’t hot-swap single channel cw lasers with Sivers) 2. $SIVE is a chokepoint over CPO. $NVDA use $COHR, $LITE (which likely sources external cw capacity from Japanese competitors) $AVGO is likely vertically integrated as well. However: the entire ecosystem around it from ASIC programs (Marvell, AlChip, etc) and merchant programs (Ayar, Lightmatter, Lightelligence) Are all likely designed around $SIVE. Ayar for example, likely tried to multi-source with $MTSI / $LITE back in 2022 but their lasers probably couldn’t match the level of Sivers specification with arrays (removed Lumentum / Macom from their supply chain site recently) If there’s no alternative at least for the initial generations (obviously they’re working to multi-source). That makes $SIVE a structural chokepoint to go through for lasers. Even if you look at the 1.6T LRO $JBL designed, they achieved a “drastic moat” with performance built around $SIVE likely sole source. $SIVE is also the foundry level reference laser design for $GFS, which your hyperscalers use like $AMD (likely using Sivers + maybe Ayar for gen1): If every major player, who hasn’t achieved vertical integration (Nvidia/Broadcom) is using Sivers for CPO… That makes them a chokepoint. Just look at the entire CPO $NVDA NVLink ecosystem partners: every single one are all likely using Sivers. And they all use $GFS as well (where Sivers is default reference). So $SIVE is both a chokepoint and bottleneck when CPO really scales up H2 2027, over one of the biggest architectural shifts of all time (near $0 -> $81B or $91B TAM in the next 1 1/2 years from GS research note) This is why I say $SIVE looks like it could be the next $75B $LITE over the next couple years. All of this should play out next year. And it’s still trading less than a company with $50M in purchase agreements that buys Sivers lasers to repackage them.
- No, people are misinterpreting $AVGO CEO comments. Demand is insatiable in general, but hyperscalers don't want to be bottlenecked, so it's inevitable $GOOGL and others multi-source. Broadcom's bottom line keeps increasing, but because the pie keeps increasing, Mediatek, Marvell, AlChip, and all the others will benefit too. But the latter much more than Broadcom.
- Just some random notes about $AVGO earnings transcript - Revenue target reiterated ($100B+ 2027, pretty sure markets wanted that to be raised this earning, hence the drop) Remember $NVDA Jensen comments about $MRVL $1T company around networking/connectivity/interconnects? - “So as the TPUs continue to accelerate, there’ll be pressure overall on margins. But the connectivity side, the AI networking side of the business has very rich margins” “Demand for … networking is simply insatiable” Also very positive read through as well for the $LITE and the other players. But for TPU margins it goes down at scale, which is understandable. - “they are placing orders in fairly huge demand, which basically gives us a lot more visibility.. runs all the way to 2028 right now” positive read through on overall AI demand since it’s 2026 now… and orders are out in 2028 - The initial order for 1 gigawatt, which includes XPUs and our networking has been received and will start Delivery in the second half of 2027. for our other two customers, we expect shipments to begin late 2026 and accelerate into 2027. $META custom AI program h2 2027 timelines - “Our revenue, our content per gigawatt will increase. you start putting a lot, you start putting embedding CPU cores into the same XPUs and making those chips basically multi die with lots of hvm.” Just for the GW modelers. - “For OpenAI we have delivered silicon and we are on track for production late 2026” OpenAI custom program timeline - “If you ask about 27 or 28 that will continue to grow. We expect in fact 28 to be a substantial growth from what we are forecasting in 27.” More about the demand ramp, go brrr - “Google, that we expect a diversity of sources from them” Mediatek (2454) primary beneficary, maybe $MRVL. Already expected though Google doesn’t sole source so they don’t get bottlenecked. There’s quite a lot of AI demand visibility way until 2028, which is bullish on the AI sector as a whole. Regardless, Broadcom ends the week +0% lol. TLDR: Strongly bullish AI demand, especially networking. Stocks don’t move in a straight line up, but demand curves 2026-> 2027 -> 2028.
- DID YOU LISTEN ANON? Reuters: New Sivers x GFS strategic collaboration. $SIVE has now announced its lasers will be integrated into reference designs built on Globalfoundries Silicon Photonics Platform. For pluggable optical transcivers, CPO, and SiPH. This is fundamentally the most groundbreaking news for Sivers in history. As Broadcom, Nvidia, Marvell, AMD, and anyone who goes through GFS silicon photonics has Sivers embedded as a default laser route. I personally think this news alone should easily 2x or 3x Sivers market cap over the medium term, given how fundamental this is to their revenue. To have Sivers be the standard laser route for the many hyperscalers that use the world's leading photonics foundry.
- The most consequential event of an entire company’s history. Got released today with a photonics player. Making them the functional standard laser for CPO, Pluggables, and SiPH. For companies like $NVDA, $AVGO, $AMD, to $MRVL using the foundry. Does anyone know the name?
- @wangxindian @StormDirac I’m not sure people realize the gravity of this news with $GFS yet. It’s probably more fundamentally groundbreaking than $SIVE + $JBL. As $AVGO, $MRVL, $NVDA or anyone who goes through GFS silicon photonics has $SIVE embedded in the reference as default.
- I never thought I’d see the day where $GOOGL needs to raise $80b for AI capex… Then Warren Buffet’s $BRK.A is funding the hyperscaler AI buildout. - $40B ATM, $30B offerings, Berkshire $10B Upstream ecosystem from $LITE to $AVGO to Mediatek to $TSM to $MU should go brrr. Not sure if the Google holders are though, given this massive capex scale isn’t as funded by FCF.
Ongoing takes on other optical names too
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