MACOM Technology Solutions Holdings, Inc. disclosed a new 3.2-terabit optical chipset on September 17, featuring eight 448-Gbps PAM-4 channels designed for next-generation data-center connectivity. The announcement came as the company’s shares had appreciated substantially over the previous year, establishing MACOM as a competitor in the rapidly expanding AI infrastructure market.
On September 18, BMO Capital upgraded MACOM shares to Outperform status with a $335 price target, citing a 36% decline from the May peak that had adjusted the company’s forward valuation to approximately 29 times earnings. The analyst noted that data-center fundamentals remained supportive despite the pullback. MACOM’s optical platform integrates drivers, photodiodes, and transimpedance amplifiers, with components already in production rather than limited to research phases.
The company faces direct competition from Coherent Corp., which supplies similar optical connectivity solutions for AI clusters. Coherent operates at greater scale within data-center optics and has achieved substantial recognition as an AI networking beneficiary. Both suppliers stand to benefit from the transition toward faster optical links, though Coherent’s larger footprint provides advantages in volume capture as speeds evolve from 800G through 1.6T and beyond.
Hedge fund positioning reflected diverging interest in the two competitors. MACOM ownership among tracked funds rose to 59 from 45 in the previous quarter, while Coherent ownership declined to 105 from 114. Short interest in MACOM totaled approximately 2.96 million shares, or 3.9% of float, at the August 31 settlement date. Market analysts contend that the optical sector can sustain multiple profitable participants simultaneously, given the substantial bandwidth requirements of advanced AI infrastructure.
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