Serenity: CW Laser Supply Bottleneck Confirmed by Multiple Optical Communication Companies

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Serenity highlighted a bottleneck in CW laser supply, confirmed by multiple optical firms, affecting technical analysis for crypto traders evaluating risk-to-reward ratios in related technology plays. Lumentum (LITE) reported strong demand for ultra-high-power lasers, enabling price increases. Applied Optoelectronics (AAOI) noted a 20%-40% supply gap, with lasers as the primary constraint. MACOM (MTSI) emphasized shortages of indium phosphide DFB lasers and high customer urgency. Both AAOI and Lumentum stated that Chinese companies are 2–3 years behind in CPO laser technology. Serenity concluded that CPO laser supply remains constrained, countering short-seller claims.

ChainThink reports that on August 12, Serenity posted that recent financial reports from multiple optical communication companies further confirm a supply bottleneck for continuous wave (CW) DFB lasers.

Lumentum (LITE) stated that demand for ultra-high-power CW lasers has exceeded expectations, creating a supply-demand imbalance, and the company has gained the ability to increase the average selling price of its lasers; its CPO capacity expansion remains on track, with shipments expected to begin in the second half of 2027.

Applied Optoelectronics (AAOI) stated that due to strong demand for optical transceivers, the company currently faces insufficient CW laser capacity, with lasers being one of the bottlenecks contributing to a 20% to 40% supply-demand gap in optical transceivers. Customers continue to request increased supply and faster delivery.

Serenity also stated that AAOI is not currently substantially involved in the deployment of first-generation CPO, while MACOM (MTSI) is more focused on NPO;

MTSI also indicated that the overall supply of indium phosphide DFB lasers is tight, and customers are experiencing strong urgency in seeking supply.

In terms of the competitive landscape, Serenity, citing management from AAOI and Lumentum, stated that Chinese manufacturers still lag significantly in the CPO laser market.

AAOI stated the gap is approximately two to three years or more, while Lumentum indicated it has not yet seen Chinese manufacturers achieve qualified production capacity and output levels commensurate with their public claims.

Serenity believes that there remain high barriers to entry for first-generation CPO-related lasers, and the market has not seen the surge in supply that some short sellers have claimed.

It also noted that Sivers Semiconductors (SIVE), with a market capitalization of approximately $1.5 billion, remains smaller than CPO-related companies such as Coherent, Lumentum, and Broadcom, and that the key future catalyst will be the transition to the next-generation optical communication architecture.

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