Coherent Reports Significant Advancement in VCSEL Performance for Next-Gen AI Networks
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Insights
The announcement from Coherent Corp. concerning the advancement in VCSEL technology represents a pivotal moment for the industry. The shift from oxide-aperture to lithographic-aperture VCSELs is not merely a technical leap but also a strategic move that could reshape market dynamics. The ability to support 200Gbps per lane is a testament to the rapid evolution of data transfer technologies, which are important to meeting the insatiable demand for higher bandwidth in data centers.
From a market perspective, this breakthrough has the potential to extend Coherent's market share and open new revenue streams. The forecasted tripling of shipments for 100G VCSELs in 2024 indicates a robust market appetite, which could be further invigorated by the introduction of 200G solutions. The long-term outlook for VCSELs remains strong, as data centers continue to be the backbone of AI, HPC and networking applications. However, the transition to 200G VCSELs will require careful monitoring of the adoption curve and price sensitivity, as well as potential supply chain adjustments to meet the anticipated demand.
The technical implications of Coherent Corp.'s advancement in VCSEL technology are profound. The increase in device bandwidth to approximately 45 GHz is a significant enhancement over the current 27 GHz limit. This leap forward is not just about raw speed; it's about the capacity to handle the explosive growth in data traffic within data centers. The multimode optical transceivers that will benefit from this innovation are critical for short-reach connectivity, which is a cornerstone of efficient and scalable data center architecture.
Understanding the nuances of lithographic-aperture VCSELs versus oxide-aperture VCSELs is important for industry stakeholders. The smaller, more reliable apertures can result in higher performance and fewer failures, which is essential for maintaining the integrity of high-speed networks. However, the transition to this new technology will require updates to existing infrastructure and could pose challenges in terms of compatibility and integration with current systems.
The financial implications for Coherent Corp. and its stakeholders are significant, given the projected increase in VCSEL shipments and the potential market dominance in high-speed optical transceivers. Investors should be aware of the capital expenditures required for such a technological upgrade and the impact on the company's profitability. The R&D costs associated with developing the lithographic-aperture VCSELs are likely substantial, but the payoff could be considerable if the company successfully captures a sizable portion of the market.
Moreover, the company's stock could see increased volatility as investors react to the news and adjust their expectations for future revenue growth. The market's response to Coherent's progress will be a key indicator of investor confidence in the company's ability to deliver on its technological promises and commercialize the new VCSELs effectively. The strategic timing of the announcement, coinciding with the OFC 2024 conference, could also play a role in influencing investor sentiment.
Sees a Path to 200G per Lane
PITTSBURGH, March 25, 2024 (GLOBE NEWSWIRE) -- Coherent Corp. (NYSE: COHR), a global leader in materials, networking, and lasers, announced today that it has made a significant breakthrough in improving the bandwidth of its vertical-cavity surface-emitting laser (VCSEL), paving the way for use in next-generation optical interconnects that will operate at 200 Gbps per lane and thereby enabling optical transceivers with 1.6 Tbps capacity.
This improvement comes in the form of lithographic-aperture VCSELs, marking a significant departure from the oxide-aperture VCSELs that are the state-of-the-art VCSELs used in AI networks today. Oxide-aperture VCSELs are currently powering optical transceivers operating at 100G per lane data rates, including 800G (8x100G) multimode optical transceivers, but have reached their bandwidth limit of approximately 27 GHz. The new lithographic-aperture VCSELs feature exceedingly small apertures with high reproducibility and reliability. With this innovative design, it is feasible to achieve a device bandwidth of approximately 45 GHz, which, when combined with recent advances in digital signal processing technology, can pave the way to 1.6T (8x200G) multimode optical transceivers.
Multimode transceivers and links are ideally suited for short-reach connectivity in data centers, spanning artificial intelligence (AI), high-performance computing (HPC), and networking applications.
A technical paper describing this leap in performance will be presented by Dr. Stefano Tirelli, Senior Manager, VCSEL Technology, at OFC 2024 in San Diego on March 25, 2024.
“As a leading supplier of VCSELs for multimode 800G optical transceivers, we are pleased to extend our technological leadership on our roadmap toward next-generation 200G VCSELs,” said Chair and CEO Dr. Vincent D. (“Chuck”) Mattera, Jr. “The development of a reliable, lithographic-aperture VCSEL is a step in the right direction. While we have more work to do, we are very pleased with the progress we have made so far.”
“100G VCSELs is already a great comeback story, and the potential for 200G VCSELs makes it truly amazing,” said Dr. Vladimir Kozlov, Founder and CEO of LightCounting Market Research. “Only three years ago, the industry consensus was that 100G VCSELs will never be reliable enough for deployments. Close to 10 million such VCSELs were shipped in 2023 as part of 400G SR4 and 800G SR8 transceivers. This number will increase by more than 3x in 2024, and 100G VCSELs will continue to ship for the rest of this decade. If available, 200G VCSELs will serve the industry for most of the next decade. As usual, some of the customers want them now, but this is a good challenge to have.”
About Coherent
Coherent empowers market innovators to define the future through breakthrough technologies, from materials to systems. We deliver innovations that resonate with our customers in diversified applications for the industrial, communications, electronics, and instrumentation markets. Headquartered in Saxonburg, Pennsylvania, Coherent has research and development, manufacturing, sales, service, and distribution facilities worldwide. For more information, please visit us at coherent.com.
Contact
Amy Wilson
Manager, Corporate Communications
corporate.communications@coherent.com
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