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Applied Optoelectronics shares drop despite strong growth plans and margin potential

Market News
13 Jun 2026
Seeking Alpha
View Source
Bullish
pluang ai news

Applied Optoelectronics (AAOI) shares have fallen from $233 to around $160, even though the company's core fundamentals remain strong. Management aims to increase production capacity from 100,000 to 930,000 units monthly by mid-FY27, supported by vertical integration and in-house laser production to ease supply constraints. Gross margins could rise from 29.2% to over 40% if these scaling targets are met. The main risk lies in execution, with FY26 revenue guidance requiring about $950 million in the last three quarters.

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