Goldman Sachs Sharply Raises Optical Module Shipment Forecasts, Projects Silicon Photonics Adoption to Surge to 80% for 1.6T Transceivers

September 13, 2026

BigGo Finance Unknown

Overview

Goldman Sachs has significantly raised its optical module shipment forecasts, noting over 200% upside potential for companies like Zhongji Innolight. Industry analysis shows 1.6T silicon photonics optical transceivers, using four 70mW CW lasers, cost approximately $15-20 for lasers, while 1.6T EML transceivers require eight 200G EMLs, with laser costs reaching $160. Goldman Sachs projects silicon photonics penetration to increase with higher transmission speeds, estimating 60% adoption for 800G, 80% for 1.6T, and 80% for 3.2T high-end optical transceivers.

In Depth

Key Findings

Goldman Sachs has substantially upgraded its optical module shipment forecasts, indicating significant upside potential, including over 200% for companies like Zhongji Innolight. This bullish outlook is driven by an anticipated dramatic increase in the adoption of silicon photonics-based optical modules as transmission speeds accelerate.

Technical / Clinical Details

Goldman Sachs’ analysis provides a compelling cost comparison between different 1.6T optical transceiver technologies. The report highlights that a 1.6T silicon photonics optical transceiver, utilizing four 70mW Continuous Wave (CW) lasers, incurs a laser cost of approximately $15-20. In stark contrast, a 1.6T Electro-absorption Modulated Laser (EML) optical transceiver requires eight 200G EMLs, pushing its laser cost to a substantial $160. This significant cost differential underscores the economic advantage of silicon photonics for large-scale deployments. Goldman Sachs projects that silicon photonics penetration will notably increase with higher transmission speeds, forecasting adoption rates of 60% for 800G, 80% for 1.6T, and an even higher 80% for future 3.2T high-end optical transceivers. This trend signifies that silicon photonics is gaining a clear advantage in balancing cost and performance as AI data center bandwidth demands rapidly expand.

Background & Context

The explosive growth of AI workloads has placed unprecedented demands on intra-data center interconnect bandwidth and power efficiency. Traditional optical module technologies are facing challenges in meeting these demands, particularly concerning cost and power consumption. Silicon photonics, a technology that integrates optical circuits onto silicon chips using standard semiconductor manufacturing processes, is emerging as a key enabler for next-generation optical communication due to its advantages in scalability, lower cost, and high integration density. The Goldman Sachs report clearly illustrates that this technology is becoming an indispensable component in enhancing the cost-efficiency and performance of AI data center construction.

Strategic Significance & Outlook

The significant upward revision of optical module shipment forecasts by Goldman Sachs, coupled with the high projected adoption rates for silicon photonics, serves as a crucial signal for investors and industry stakeholders. Companies specializing in silicon photonics, such as Zhongji Innolight, are particularly well-positioned to benefit from this technological trend, with over 200% implied upside in their target price reflecting strong market confidence in this innovation. As AI data center demands continue to intensify, silicon photonics-based optical modules will become even more critical as high-performance, cost-effective solutions. This technology is expected to be a fundamental driver supporting the sustainable development of AI, promising long-term growth.

Source: https://finance.biggo.com/news/64d9d1d0-6628-4735-a77a-05fb5c3ce9ee

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