Applied Optoelectronics

AAOI · NASDAQ

$76.74−$1.46 (−1.87%)TodayMarket closed · Oct 20, 4:05 PM ET

Prev close $78.20

AAOI analyst rating

BuyConsensus of 4 analysts over the last 12 months. 75% rate it a buy.

Strong buy0
Buy3
Hold1
Underperform0
Sell0

12-month price target · 8 analysts

Average $145.86 (+90.1% upside)

Low: $41.41
Now: $76.74
High: $231.00

Upgrades and downgrades

The latest rating actions, newest first

AAOI analyst upgrades, downgrades and rating actions
Firm	Date	Action	Rating	Price target	Hit rate
B. Riley Securities	Oct 15, 2026	Maintains	Neutral	$109.00 → $92.00	50%
Rosenblatt	Aug 7, 2026	Maintains	Buy	$220.00	56%
Needham	Aug 7, 2026	Maintains	Buy	$220.00 → $190.00	50%
Needham	Jul 22, 2026	Maintains	Buy	$260.00 → $220.00	50%
Rosenblatt	Jun 22, 2026	Maintains	Buy	$220.00	56%
Rosenblatt	May 8, 2026	Maintains	Buy	$140.00 → $220.00	56%
Needham	Apr 21, 2026	Maintains	Buy	$130.00 → $190.00	50%
Rosenblatt	Mar 9, 2026	Maintains	Buy	$125.00 → $140.00	56%
Rosenblatt	Feb 27, 2026	Maintains	Buy	$50.00 → $125.00	56%
Needham	Feb 27, 2026	Maintains	Buy	$43.00 → $80.00	50%

The case for and against

Updated Oct 14, 2026

Bull case

Applied Optoelectronics is supported by a sharp acceleration in data-center demand, with 2Q26 revenue of $192M rising 86% Y/Y and 800G revenue jumping from $5M in 1Q26 to $13M in 2Q26, while management guided 3Q26 800G revenue to about $65M. Its outlook is strengthened by a visible product cycle upgrade into 1.6T, strong hyperscaler traction, and customer concentration that includes Amazon plus a major Oracle-related opportunity, which together support a path to much larger revenue in 2027. Heavy capital spending of $566M in 2Q26 and rapid Texas capacity expansion are near-term constraints, but they also signal management’s confidence that demand can outgrow supply and improve margins over time.

Bear case

Applied Optoelectronics is exposed to severe customer concentration, with its top two customers accounting for 78% of 2024 revenue and 82% in 2025, leaving results vulnerable to any slowdown, cancellation, or delay from a small number of buyers. Its operating margin was (5.4%) and missed expectations by 550 bps, while higher shipping costs, elevated R&D, and a high fixed-cost, vertically integrated model limit flexibility and can amplify inventory and absorption pressures when demand softens. Near-term visibility is weak because 100G revenue is expected to decline ~50% Q/Q in 3Q26, 1.6T volumes remain constrained by TIA and DSP supply, and unhedged foreign currency exposure adds another layer of earnings risk.

Information on this page is provided for informational purposes only and is not a recommendation to buy, sell or hold any security. Investing involves risk, including possible loss of principal. Market data is delayed at least 15 minutes and is provided without warranty. Analyst ratings, price targets and company data come from third-party sources. Past performance does not guarantee future results.