Earnings expected at 4:10 p.m. ET

Applied Optoelectronic’s conference call is done, but there was a pretty wild quote on it.

The TLDR, revenue for the just finished year was $456 million. AAOI laid out the case on its call how it could be doing $378 million in MONTHLY revenue by mid-2027.

It’s a little shocking that the stock is only up 17% given how outrageously bullish these comments are. Here’s the full quote:

“Going forward, we believe we are well positioned for sustained growth across both our data center and CATV businesses, and the capital investments underway are expected to fundamentally strengthen the company as we execute on these opportunities.

Given the recent surge in customer inquiries and apparent rising demand, we believe that by mid-2027, 100G and 400G revenue will be approximately $90 million. 800G revenue will be approximately $217 million and 1.6 terabit revenue will be approximately $71 million monthly. Altogether, this represents $378 million in monthly revenue for transceiver products.

However, we believe that the customer demand is even larger than this. In order to accommodate this expected surge in demand, we plan to more than triple our laser manufacturing in Texas. We are evaluating our CapEx projections for 2026, and we intend to share those at a later date.”

And here’s another nugget from the call, the company is forecasting more than $1 billion in sales in 2026. Wall Street estimates before the call were $764 million.

“Looking more broadly at 2026. While it’s still early in the year, we expect to generate over $1 billion in revenue this year, with a non-GAAP operating profit of over $120 million.

This revenue level is limited by our production capacity and supply chain, not market demand, which we believe is much larger. Based on our planned capacity additions, we expect to see continued strong sequential revenue growth in the first 2 quarters with an acceleration in the second half of the year as new production capacity comes online and additional customer qualifications are completed and orders begin to ship.

We believe that this is an ambitious yet achievable target based upon our customers’ forecast and what we know about the unprecedented investments that are being made in AI infrastructure.”

All I can say is holy cow. We recommended AAOI back at $22.36 in 24/7 Wall St’s $500,000 AI Portfolio. That price is looking like a steal and I’d be surprised if shares didn’t rise even more than where they’re at right now by tomorrow’s open.

It was a strong beat on Q1 guide, and Applied Optoelectronic shares are ralliyng, now up 14%.

Keep in mind shares dropped 7.6% today, so AAOI has recovered all those losses and gained an additional 6%.

Revenue of $134.3 million beats, but is near the midpoint of prior guidance.

Q1 guidance is for $150 million to $165 million.

Wall Street had expected $145.7 million. Shares have immediately jumped 9% on the release.

AI infrastructure stocks were hit hard today after Wall Street sold off NVIDIA despite really strong earnings.

We expect Applied’s earnings in less than 10 minutes.

The valuation for Applied Optoelecronics depends heavily on future growth. Here’s what Wall Street expects this year, and looking ahead:

2025 Expectations (Only Q4 Left to Report)

• Revenue: $453.7 million
• Adjusted EPS: $-.38

2026 Expectations

• Revenue: $764 million
• Adjusted EPS: $.83

2027 Expectations

• Revenue: $1.36 billion
• Adjusted EPS: $1.50