Samsung Electronics Co., Ltd. recently announced its first-quarter financial results, with analysts attributing the better-than-expected performance to demand for AI servers and a shortage of memory chips. Shortly after, during the earnings conference call, the company revealed it had secured orders related to optical communications and plans to begin mass production in the second half of this year.
According to media reports such as ZDnet, Samsung Electronics is currently in discussions with several major global clients regarding commercialization and intends to start a foundry partnership with a leading optical module manufacturer in the latter half of the year.
The company's Executive Vice President and Chief Financial Officer, Park Soon-cheol, stated that thanks to stable yields from advanced processes, the foundry business is expected to achieve double-digit revenue growth and improved profitability. He added that the company is working to diversify its application areas beyond mobile devices to strengthen its business structure.
In March of this year, Samsung Electronics officially announced its entry into the optical communications market. At the 2026 Optical Fiber Communication Conference held in Los Angeles, the company disclosed progress in developing its optical communication foundry platform and its mass production roadmap. Samsung indicated that preparations for mass production are complete, including the finalization of the Process Design Kit, and production can begin immediately once customer design plans are confirmed.
Mass production will be carried out on a 300mm wafer platform. Initially, the company will focus on Photonic Integrated Circuits, with applications ranging from data center optical modules to CPO optical engines. Samsung's roadmap shows plans to achieve thermal compression bonding-based optical engines by 2027, transition to hybrid bonding in 2028, and begin offering full-service, turnkey CPO solutions starting in 2029.
According to Trendforce forecasts, traditional copper cable power transmission faces physical limitations that may struggle to support the massive data transfer requirements of next-generation AI infrastructure. Consequently, the importance of optical transmission technology is increasingly prominent. It is projected that the share of CPO within AI data center optical communication modules will grow steadily, potentially reaching a penetration rate of 35% by 2030.
Analysts suggest that core supply chain companies for CPO are likely to benefit continuously from the accelerating adoption trend. Key CPO optical components include lasers, optical engines, FAUs, Shuffle Boxes, and MPOs. The primary beneficiaries on the manufacturing side include wafer fabrication, outsourced assembly and testing providers, and CPO testing specialists.
It is further indicated that CPO testing equipment manufacturers stand to benefit significantly. This includes companies specializing in complex optical alignment and those benefiting from increased numbers of optical channels and higher bandwidth. Platform-based testing firms are also expected to gain from the increased complexity of chip testing driven by CPO adoption.
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