Datacom optical component revenue grew for the 4th straight quarter with the explosion of demand for optics used in AI clusters, according to the most recent 4Q23 Optical Components Report from research firm Cignal AI.
Nvidia, Coherent, and Innolight lead in 800GbE Datacom module shipments for hyperscale AI applications. Acacia and Marvell lead in shipments of high-performance coherent interfaces based on large volumes of 400ZR pluggables.
More Key Findings from the 4Q23 Optical Component Report:
- Datacom revenue reached record levels, up 11% YoY, and module shipments grew rapidly in the last 2 quarters of 2023 as AI demand accelerated. For all of 2023, total Datacom revenue was down -4%, weighed down by poor performance at the start of the year.
- After a sharp drop at the start of 2023, 400GbE port shipments recovered and grew over 50% YoY in 4Q23.
- The high-speed Datacom optical component market is forecast to exceed $10 billion by 2025.
- Coherent port shipments increased QoQ, but they were down slightly YoY. 400ZR/ZR+ shipments grew 25% QoQ.
The market for embedded and pluggable coherent optical modules is forecast to exceed $6 billion in 2024.
- Huawei, Infinera, Acacia, and Nokia shipped Gen120P 1.2T high speed coherent ports for revenue in 4Q23, which is the first quarter of production shipments for this new technology.
Cignal AI's 2024 forecast for 800GbE modules was increased 8% based on accelerating demand, and initial forecasts of 1600ZR modules were also added to the Optical Components report this quarter.
Scott Wilkinson, Lead Analyst for Optical Components at Cignal AI
Datacom shipments, especially 800GbE optics, are ramping up fast and shipped units are forecast to reach 8 million in 2024. Telecom is slowly recovering from a bottom in Q3, but no immediate reversal is in sight.
