🔥BNP Paribas raised Lumentum's target price to $1040. What I care more about is: the bottleneck of AI competition has shifted from GPUs to "light".

The most crucial point isn't the target price, but the underlying logic is changing:

The core competition in AI is shifting from "computing power chips" to "computing power connectivity".

The reason Lumentum is being repriced this time is actually quite focused:

It's stuck at the most critical link in AI infrastructure—the core components of optical communication.

Moreover, its key customers are very clear:

NVIDIA

Google

These two companies represent, respectively:

AI computing power platforms

AI network architecture

I'm paying more attention to three changes.

First, bandwidth demand is undergoing an "exponential leap"

From 400G → 800G → 1.6T

This isn't a simple upgrade, but:

The inevitable result of AI cluster scale expansion

As models get larger and GPUs increase, the real problem becomes:

How data flows between GPUs.

Second, the technological path is switching

Past connection methods mainly relied on electrical signals.

But as power consumption and latency issues amplify, bottlenecks have emerged.

So the current direction is:

Optics in, electricity out

And the core of what Lumentum does is:

EML chips

High-power lasers

Optical circuit switching

These are all fundamental components of the optical interconnect system.

Third, CPO (Co-Packaged Optics) is beginning to enter the practical stage

The report mentions a key point:

NVIDIA is advancing co-packaged optical switching architecture

This means:

Optics is no longer a peripheral module but is starting to enter the core system

Once this holds true, the value chain will change.

I will pay special attention to two details.

One is:

400mW ultra-high-power lasers

This type of product isn't an ordinary component, but:

The key energy source for high-density AI networks

The other is:

MEMS optical switches

This directly corresponds to:

The flexibility of network structure

That is, how AI clusters are dynamically scheduled.

Looking at financial expectations:

Revenue target around $8 billion

Operating margin around 40%

This indicates the market's logic isn't a "cyclical stock," but:

A high-barrier, high-margin infrastructure company

But I won't ignore one reality:

The current rise is essentially already trading "growth over the next two to three years."

In other words:

Many expectations have already been priced in.

So my current judgment leans more towards:

This logic is correct, but the timing is crucial.

Short term:

Volatility may occur because expectations have already been raised

Medium term:

As 800G, 1.6T truly ramp up, performance begins to materialize

Long term:

The key lies in whether optical interconnect becomes the core standard for AI infrastructure

The greater significance of this matter is:

It once again verifies one point:

The bottleneck of the AI industry is shifting from "computing power manufacturing" to "computing power connectivity."

So the real question isn't:

Whether Lumentum can still rise

But:

When optical communication becomes a core link in AI infrastructure, will the market redefine the valuation of this entire sector?

Do you tend to think this is an individual stock opportunity,

Or is a new core track emerging in the AI infrastructure chain?