Written by: DaiDai, MaiTong MSX

Many people thought that Jensen Huang would ignite optical communication at GTC this time.

After all, this line has been hot for too long. From CPO to silicon photonics, from optical modules to high-speed interconnects, the market has almost pressed all imaginations about AI infrastructure upgrades onto this. Coincidentally, OFC 2026 is also held in the same week, with the technical conference from March 15 to 19 and the exhibition from March 17 to 19. One is NVIDIA talking about the roadmap, and the other is the entire optical communication industry chain showing off its muscles, naturally pushing the heat to a high point.

So before Jensen Huang took the stage, the market was not waiting for an ordinary speech, but a fire. What everyone wanted to hear was not "there’s no problem with future directions," but a clearer statement: in the next stage, light will be the main thread.

Unfortunately, Jensen Huang did not deliver that version of the message.

GTC Jensen Huang speech scene Source: The Business Journals

Jensen Huang clearly talked about light, so why is the market still not buying in?

During this period, the reason optical communication has been so hyped is not just because it sounds sophisticated, but because the logic is too straightforward——as AI clusters grow larger, data transmission pressure increases, copper will inevitably face bottlenecks, so isn’t it time for light to take over?

This story is too easy to establish. Because it’s so easy to establish, the market will naturally think a step further; since the direction is so clear, the fulfillment shouldn’t be too far off.

So before GTC, much of the investment was no longer discussing "whether light works," but was speculating whether Jensen Huang would explain this matter more aggressively than everyone expected.

Data center equipment room and wiring Source: The Fiber Optic Association

The issue isn't whether he mentioned light.

He definitely mentioned it, and he mentioned it quite a bit. It’s just that what Jensen Huang actually conveyed was that while light is important, copper isn't going away anytime soon, "NVIDIA plans to continue using copper-based connections along with updated optical technology in the upcoming platforms (including Vera Rubin Ultra and future systems)."

The market originally wanted to hear that light was about to become fully on top, and this slight difference was enough to cause the market to change its face.

This is also the most awkward aspect for the market, as stocks often fear not bad news but rather that the good news isn't as great as imagined.

The issue isn't "do we believe in light," but "is it time to realize it?"

The most easily misunderstood point this time is that many people will interpret it as "light is no good" or "copper won."

In fact, neither is true.

More accurately, the long-term logic of light hasn't changed; what has changed is the market’s perception of its realization speed. NVIDIA's official technical blog clearly lays out this logic regarding the Vera Rubin platform: larger scale systems will use direct optical connections for rack-to-rack connections, but many positions within the rack are still built on copper spines and pre-integrated copper cables.

Simply put, in many places within the rack, copper is still the main player; when it comes to larger scale, cross-rack areas, the importance of light begins to rise significantly.

Therefore, what GTC truly rectified was not the direction but the timetable. In the past, when the market bought into this line, they were buying a large future; now the market is beginning to question: who will realize this future first, and when.

CPO equipment/system display Source: Cisco Blogs

The market has shifted from "fully transitioning to light" to "beginning to differentiate"

Because of this, after the speech, it wasn't a "full line surge," but rather a mix-up first, followed by differentiation.

Barron’s summary of the market this time is quite apt: the market interpreted Jensen Huang's statements as "both copper and light will continue to be used," which directly shifted the sector from a "as long as it has light, it rises" trading theme back to a "who truly benefits and who is just lifted by the heat" differentiation trading.

If we zoom in on individual stocks, this differentiation becomes more pronounced.

• Lumentum (LITE.M) is still widely discussed in the market not just because it belongs to the "light" line, but because it has transitioned in investors' minds from just being a concept stock to being placed in the list of "those that truly have a chance to enter the next-generation interconnect system." Because of this, even though short-term sentiments may fluctuate, the market's understanding stays closer to "changing rhythm" rather than "disappearing logic." Barron’s mentioned that on March 17, Lumentum was one of the few stocks that could still close higher;
• Coherent (COHR.M) has a somewhat similar position to Lumentum, but the market's pricing won't be entirely the same. Once the sector shifts from "big narrative" to "grounded talk," investors will care more about exactly which layer each company benefits from, how long the realization takes, and whether prior expectations were too high. It doesn't lack direction, but it is more likely to enter the "has logic, but needs to recalculate time" stage. Barron’s daily recap mentioned that Coherent performed noticeably worse than Lumentum on that day;
• Ciena (CIEN.M) is somewhat special. It doesn't experience the dramatic pushes and drops of more elastic names during emotional market swings. In this round of discussion, it resembles a target that prompts the market to think about "how will the future optical network really unfold." Its significance is not just to ride a hot term but to remind everyone: if future large-scale AI infrastructure is to be continually upgraded, it will involve not just a component story but how the entire network capability progresses. Barron’s post-GTC summary also categorized Ciena as "relatively stable within the optical chain";
• Applied Optoelectronics (AAOI.M) is more like the typical high elasticity representative in this wave of market motion. Such stocks often rise rapidly when sentiment is good; conversely, as soon as the catalyst isn't strong enough to continue lifting expectations, they are the first to bear the withdrawal pressure. Its volatility illustrates a point: when the market begins to doubt "will realization be slower than imagined," the first to be hit are often those that have risen the fastest and had the highest expectations. Barron’s report on March 17 also placed AAOI on the side of pressure;
• Credo (CRDO.M) revealed another important change after this GTC: it's not just about being related to "copper" to benefit automatically. Jensen Huang clarified that copper isn't exiting immediately, but that doesn't mean all copper chain companies will be rewarded by the market right away. Because funding will next question more finely: which segment of copper connections benefits the most? Is it short-range? Is it AEC? Or other links? Barron’s recap shows that Credo has also seen great fluctuations in this round of sentiment, which itself indicates that the market no longer accepts the simple narrative of "as long as you stand with the theme, you rise together";

OFC venue photos Source: Public News Images

In the end, when looking at these stocks together, what’s worth noting is not who is rising or falling but that the market has begun to view them as assets with different positions, different realization rhythms, and different certainties.

In the previous phase, everyone was more willing to put them in the same basket, but from GTC onwards, this basket is being dismantled. AI interconnect is not a "choice of light or copper," but a division of "who uses what where" question.

Ultimately, Huang did not deny light; he just did not convey the message that the market most wanted to hear. Therefore, after GTC, the market is no longer just looking at "whether there is a story," but "who is closer to landing, who is closer to realization," which is why, despite all being in the optical communication line, stock performance is starting to show clear differentiation.

In the earlier stage, many companies could still be traded in the same basket; but from now on, the market will look more closely: who benefits first, who verifies first, and who was just pushed up by emotion.

The real differentiation has just begun

The direction of light hasn't changed, but the market's perspective on this line has.

Previously, everyone was more willing to pay for imaginations; next, the market will focus more on realization. Therefore, the real gap opening up later will not be about who tells a better story, but about who turns the story into performance first.

We'll wait and see.

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