MACOM Technology Solutions Holdings, Inc. announced on September 17 a new 3.2-terabit optical chipset designed around eight 448-Gbps PAM-4 channels. The announcement came as the company’s stock performance attracted renewed investor attention following a significant run-up in valuation.
One day after the chipset announcement, BMO Capital upgraded the stock to Outperform with a $335 price target. The analyst noted that the shares had declined 36% from their May peak, which compressed the forward valuation to approximately 29 times earnings. Despite this pullback, BMO argued that underlying data-center fundamentals remained supportive. The new optical platform integrates drivers, photodiodes, and transimpedance amplifiers for next-generation optical modules, with the company indicating these components are currently available rather than at a research stage.
MAC0M competes directly with Coherent Corp., which also supplies optical connectivity solutions for AI infrastructure. The opportunity for MACOM centers on content growth as optical links advance toward higher speeds like 3.2T. Components at these speeds require more sophisticated analog and photonic capabilities. A supplier capable of providing both transmit and receive building blocks can offer customers advantages by reducing qualification requirements.
Hedge fund positioning showed mixed signals. Insider Monkey’s Q2 data indicated MACOM ownership rose to 59 hedge funds from 45 in Q1, while Coherent ownership declined to 105 funds from 114. Whale Rock Capital held approximately 989,000 MACOM shares after reducing its stake 16%, while D. E. Shaw significantly increased its Coherent position to roughly 1.64 million shares. Short interest in MACOM stood at approximately 2.96 million shares, representing roughly 3.9% of float with 2.4 days to cover as of August 31.
The competitive landscape suggests room for multiple optical suppliers as AI infrastructure expansion continues. MACOM’s new chipset represents a shift in market positioning, with the company now shipping components directly targeted at next-generation optical links rather than operating on the periphery of the AI hardware trade.
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