Analyst highlights Lumentum and Coherent as AI demand pivots from GPUs to optical connectivity infrastructure.
Goldman Sachs identifies Lumentum (LITE) and Coherent (COHR) as key beneficiaries of a shift in AI infrastructure from graphics processors to optical connectivity. LITE has surged 600% over the past year amid rising demand for scalable optical capacity.
The transition reflects a move from AI training to inference workloads, which requires more data centers and enhanced connectivity. This shift is expected to extend the trade duration for optical stocks beyond prior semiconductor cycles.
The firm’s public technology investing co-head emphasized the architectural changes driving this trend, noting that inference workloads necessitate a different set of chips and equipment.