EB SECURITIES: The Data Nerves of AI Computing Power The Optical Fiber Industry Ushers in Supply-Demand Restructuring and Value Breakthrough

EB SECURITIES released a research report stating that the current supply-demand landscape in the optical fiber industry is relatively tight. AI computing power and the commercialization of CPO technology are driving high growth in demand for high-end optical fiber. Combined with the recovery in operator centralized procurement and improving overseas exports, product prices and profitability levels continue to recover. It is recommended to focus on leading enterprises with independent production capacity for optical fiber preforms and first-mover advantages in AI computing power optical communication products and specialty optical fiber fields. EB SECURITIES' main views are as follows: Optical fiber preforms are the core barrier, and the optical fiber industry landscape is highly concentrated As the core carrier of digital information transmission, optical fiber has undergone nearly two hundred years of technological iteration and has formed a mature and complete industrial system, becoming the core foundation of digital infrastructure. In terms of the industrial chain, the industry has formed a complete closed loop of "preform - optical fiber and cable - terminal applications," in which optical fiber preforms account for 70% of the industrial chain's profits and represent the core barrier segment. Global optical fiber and cable is dominated by US and Chinese companies. US-based Corning holds the top global position with a 19.5% share, while China's Yangtze Optical Fibre and Cable Joint Stock, Jiangsu Zhongtian Technology, Hengtong Optic-Electric, and Fiberhome Telecommunication Technologies together account for nearly 50%. China is currently the world's largest producer, consumer, and exporter of optical fiber. Copper cable transmission bottlenecks are becoming prominent, and the growth driver of optical fiber is switching from traditional communications to computing power infrastructure Rapid AI computing power iteration has made copper cable transmission bottlenecks prominent. CPO co-packaged optics technology, with its advantages of chip-level all-optical interconnection, low loss, and low power consumption, has become the core transformation direction for data centers to reduce costs and improve efficiency and support ultra-high-bandwidth computing power transmission. According to Yole data, the global CPO market will grow from US$46 million in 2024 to US$8.1 billion in 2030, with a compound annual growth rate of 137%. The acceleration of CPO commercialization is driving high growth in demand for high-end supporting polarization-maintaining fiber. At present, the polarization-maintaining fiber market presents an oligopolistic landscape of overseas leaders and leading domestic enterprises, and under the pull of new demand in the future, the industry landscape may be reshaped. In addition, hollow-core fiber, a frontier technology once confined to laboratories, is also moving toward live network deployment at an unprecedented speed, breaking computing power bottlenecks and opening a generational leap in communications. Optical fiber is in a state of tight supply-demand balance, expected to open a new cycle of value revaluation Constrained by the long expansion cycle of optical fiber preforms and low early-stage capital expenditure in the industry, the supply of the optical fiber industry is relatively rigid. Meanwhile, AI computing power construction, recovery in operator centralized procurement, and a rebound in overseas exports are driving demand upward significantly. High-end AI optical fiber is gradually crowding out production capacity, driving rapid price increases across various types of optical fiber. The bank believes that the AI computing power wave will reshape the logic of the optical fiber industry. Optical fiber usage in intelligent computing centers will increase severalfold compared with traditional data centers, and the industry supply-demand gap may continue to widen. At the same time, with the rapid volume growth of demand for high-gross-margin specialty optical fiber, the industry will also break away from the low-margin model of traditional ordinary optical fiber and overall enter a new cycle of upward prosperity and value revaluation. Risk analysis: changes in import and export policies, supply-demand imbalance, price fluctuations, intensifying market competition, etc.