Optical communication device makers to see datacenter apps buoy 2H22 shipments

Most of Taiwan’s optical communication devices makers focusing more on datacenter than 5G base station applications have reported significant revenue improvements for the first half of the year and are expected to perform even better in the second half on continuous spec upgrades for datacenter solutions, according to industry sources.

Optical transceiver modules specialist LuxNet, which suffered net loss of NT$285 million (US$9.54 million) in 2021, saw its first-quarter 2022 deficit narrowly sharply to NT$1.8 million and scored net earnings of NT$55 million in April-May. The company is believed to have returned to profitability in the second quarter of the year, with its June revenues surging 41.25% over the year to NT$106 million.

LuxNet’s revenue and profit improvements mainly resulted from increased shipments for high-speed 5G and datacenter applications, and its overall product portfolios will improve sharply in the months ahead as US networking chip vendors have outsourced the assembly of more 400G optical transceiver modules for datacenters to the company, the sources said.

East Tender Optoelectronics (EOC), dedicated to optical thin-film filters, has reported its June revenues rose 21% on month to NT$21 million, and January-June sales increased 13% on year to NT$115 million.

But the company noted the first-half 2022 revenue performance was still short of its growth goal, mainly because telecom operators in China were slowing down construction of 5G base stations due to high inventory of 5G smartphones amid sluggish consumer demand.

The company expects its shipments and revenues to improve in the second half of the year, as the US telecom operators are on track to accelerate 5G networks construction under handsome government subsides and major datacenter operators continue to expand their operations.

Browave, specializing in optical transceiver components driven and interconnect solutions for datacenters, scoring record revenues of NT$1.67 billion for first-half 2022, up 53.4% ​​on year, mainly by mainstream shipments to major clients shifting to 400G solutions.

The company expects shipments to datacenter clients to grow 30% in 2022, and will enter volume production of 800G solutions in the second half of the year. Additionally, its US-bound shipments of over 10G transceiver solutions for cable TV applications will also ramp up steadily along with CATV operators to upgrade their broadband network continuing specs.

TrueLight saw its January-June revenues slip 17.8% on the year to NT$563 million, due mainly to a slowdown in the construction of 5G base stations in China and a still relatively low ratio for shipments to the US and Europe.

The company is conservative about its third-quarter performance, with sales likely to continue falling sequentially, given sluggish demand for its handset-use proximity sensors despite clear order visibility for 10G PON (passive optical network) fiber-to-the-home solutions.

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