AI computing power demand drives explosive growth in high-speed optical modules, Cambridge Technology's net profit for the first half of the year expected to increase by 156.65% to 197.18% | Earnings Report Insights

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The expansion of AI computing power infrastructure continues to push upstream, and optical module manufacturers are ushering in a period of high growth.

On July 14, Cambridge Technology issued a forecast for its 2026 semi-annual performance, expecting a net profit attributable to shareholders of the listed company of 310 million to 359 million yuan in the first half of the year, a year-on-year increase of 156.65% to 197.18%; net profit after deducting non-recurring gains and losses is expected to be 302 million to 351 million yuan, up 153.72% to 194.97% year-on-year.

The company stated that the major driver of performance growth comes from rapid development in the high-speed optical module business. The acceleration of AI data center development is driving increased demand for high-speed optical modules. The scale of orders and shipment values have risen sharply year-on-year, while the proportion of high-speed products such as 800G has grown, optimizing product structure and improving gross margin.

In terms of quality of performance, this round of growth mainly comes from improvements in core business. In the same period last year, net profit attributable to shareholders was 121 million yuan; the lower limit of the current forecast has already exceeded twice that amount. At the same time, the scale of net profit after deductions is close to the net profit attributable to shareholders, indicating a limited impact of non-recurring items on performance.

High-speed optical module demand surges, volume and price rise drive profit improvement

The core driver of this round of performance growth for Cambridge Technology comes from high-speed optical module business.

As demand for AI large model training and inference continues to grow, global data centers are accelerating expansion, and demand for high-speed interconnection products is rapidly rising. 800G optical modules are becoming a key supporting product for AI cluster construction and evolving toward 1.6T and higher speeds.

Against this trend, Cambridge Technology benefits from both growing market demand and continuous expansion of the order scale; at the same time, as the sales proportion of high-speed products grows, product added value and profitability improve together, driving a dual increase in the company’s revenue and profit.

According to the company’s announcement, there is no significant impact of non-recurring gains or losses in this period’s performance growth, nor any special accounting treatments. The main source of profit growth is the improvement in core business.

Forex loss drags down profit by over 200 million yuan, future forex exposure expected to narrow

While the high-speed optical module business grows rapidly, exchange rate fluctuations have placed clear pressure on the company's profits.

Cambridge Technology previously raised funds through its Hong Kong IPO and placement, with part of the proceeds kept in Hong Kong dollars. Since the beginning of this year, the weakening of the US dollar has led to fluctuations in the Hong Kong dollar exchange rate, turning the company’s forex gains into losses. Data shows the company is expected to incur about 202 million yuan in forex losses in the first half of 2026, compared to a 13.65 million yuan forex gain in the same period last year.

However, as the raised funds are deployed as planned for capacity and business expansion, the scale of related foreign exchange assets is expected to gradually decrease, and the impact of forex on future profit is projected to diminish.

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