On Monday, June 29th, the optical communication sector, including CPO and optical fiber cables, bucked the trend and corrected, with significant divergence among individual stocks. Zhisheng Technology led the decline, falling over 10%, while Suzhou Tfc Optical Communication Co.,Ltd. (SZSE: 300394) dropped more than 7% and remained weak throughout the day.
Meanwhile, the two leading stocks staged notable intraday V-shaped rebounds. Eoptolink Technology Inc.,Ltd. saw its losses narrow from over 7% to close down 1.6%, while InnoLight Technology Corporation pared a decline exceeding 6% to end the day 2.7% lower.
Key ETF Performance
Among popular ETFs, the ChiNext Artificial Intelligence ETF (159363), which focuses on CPO, also experienced a dip and recovery, falling over 4% intraday before rebounding in the afternoon to close down 1.46% on the secondary market. In terms of fund flows, the ETF saw a net subscription of 102 million units that day, following a cumulative net inflow of over 2.2 billion yuan in the previous week.
Primary Catalyst for the Decline
The immediate trigger for this round of decline in the optical communication sector was the Glass Bridge optical interconnect platform released by American fiber optic giant Corning at the "AI Data Center Optical Communication Interconnect Technology Conference" on June 24th. Market concerns arose as this technology utilizes wafer-level preformed glass optical waveguides to achieve passive alignment between optical fibers and photonic chips. This is expected to significantly simplify the fiber array units (FAUs) and precision active coupling equipment traditionally relied upon in CPO architectures, potentially leading to long-term contraction pressure on demand for related mid-stream components.
Analyzing the Disparity in Stock Declines
Why did Suzhou Tfc Optical Communication Co.,Ltd. experience a notably larger decline compared to InnoLight Technology Corporation and Eoptolink Technology Inc.,Ltd.? The reason likely lies in their different positions within the industry chain. InnoLight Technology Corporation and Eoptolink Technology Inc.,Ltd. primarily focus on downstream finished optical modules. Corning's technology does not directly impact end-user demand, and the high growth trajectory of AI computing power continues to support their fundamental logic, resulting in smaller declines. In contrast, Suzhou Tfc Optical Communication Co.,Ltd., as a leading upstream optical component manufacturer, faces a direct substitution threat from the Glass Bridge technology, hence bearing the deepest pressure.
Long-Term Industry Perspective
However, from a broader perspective, the "Glass Bridge" technology pre-sets optical paths within glass using wafer-level processes, simplifying the coupling between photonic integrated circuits (PICs) and external optical circuits. This essentially paves the "last mile" of the assembly road for CPO, transforming it from a "precision manual craft" in laboratories to a standardized, mass-producible "industrial product." Therefore, "Glass Bridge" acts as a catalyst for CPO industrialization, not a competitor.
Future Outlook and Analysis
Looking ahead, analysis suggests that with iterative advancements across the entire industry chain, the CPO (co-packaged optics) photoelectric co-packaging track has a clear growth logic, and the industry's potential is fully opening up. As a disruptive technology for optical interconnects in AI data centers, CPO fundamentally breaks through the three major physical bottlenecks of power consumption, density, and bandwidth inherent in traditional pluggable optical modules, representing the core evolutionary direction for next-generation ultra-high-speed computing networks. It is recommended to maintain focus on upstream materials and components, as well as mid-stream optical communication equipment.
ETF Investment Focus
The ChiNext Artificial Intelligence ETF (159363) and its corresponding feeder funds focus on leading CPO companies. The underlying index has a combined weighting of approximately 40% in InnoLight Technology Corporation, Eoptolink Technology Inc.,Ltd., and Suzhou Tfc Optical Communication Co.,Ltd., positioning it as a core representative of AI computing power. Furthermore, the latest size of the ChiNext Artificial Intelligence ETF (159363) exceeds 8 billion yuan, with an average daily turnover over the past six months surpassing 900 million yuan, ranking first in both size and liquidity within the dual-innovation AI investment theme.
Investment Considerations
Investors should be aware that the ChiNext Artificial Intelligence ETF passively tracks the ChiNext Artificial Intelligence Index. The index's backtested historical performance does not indicate its future returns. Constituent stocks mentioned are for illustrative purposes only and do not constitute investment advice or represent the holdings or trading activities of the fund manager. The fund manager assesses the risk level of this ETF as R4 (Medium-High Risk), suitable for aggressive (C4) and above investors. Investment decisions should be based on individual suitability assessments from sales institutions. All information presented is for reference only. Investors are responsible for their own investment decisions. The views, analysis, and forecasts herein do not constitute investment advice of any kind, and no liability is accepted for any direct or indirect losses arising from the use of this content. Fund investment carries risks. Past performance of a fund does not guarantee its future results, and the performance of other funds managed by the same manager does not constitute a guarantee of this fund's performance. Invest with caution.
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