ZHONGJI INNOLIGHT(SZ:300308) Zhao Yin Guo Ji·2025-11-27 07:26Investment Rating - The report maintains a "Buy" rating for the optical module industry, specifically for Zhongji Xuchuang (300308 CH) with a target price of 591.00 RMB [2][27]. Core Insights - The optical module industry is expected to perform strongly in 2025, driven by high AI business proportions among suppliers, with significant revenue growth and profit margin expansion anticipated [2][4]. - Major cloud providers in the U.S. are projected to increase their capital expenditures significantly, reaching $367 billion in 2025, which will benefit optical module suppliers [5][11]. - The demand for 1.6T optical modules is expected to rise, contributing to the overall growth of the industry [21][24]. Summary by Sections Industry Performance - The optical module sector is highlighted as a preferred segment, with leading companies like Coherent, Zhongji Xuchuang, and Xinyi Sheng showing substantial revenue growth in 2025 [4][14]. - Revenue growth rates for these companies in the first three quarters of 2025 are projected at 19%, 44%, and 221% respectively [4][14]. Capital Expenditure Trends - The four major U.S. cloud providers (Google, Microsoft, Meta, Amazon) are expected to spend $2.3 billion in 2024, a 55% increase year-over-year, and further increase to $3.67 billion in 2025 [3][5]. - Forecasts indicate a continued increase in capital expenditures, with a projected 35% growth to $495 billion in 2026 [6][11]. Supply Chain Dynamics - The supply of key components, particularly EML chips, is under pressure, with Lumentum indicating that demand significantly exceeds supply [22][24]. - The industry is actively expanding production capacity, with Lumentum planning a 40% increase in capacity [22][23]. Future Outlook - The report anticipates that the optical module industry will continue to thrive, with a focus on high-value solutions and the transition to 1.6T products [21][27]. - The expected shipment volumes for 800G and 1.6T optical modules in 2026 are projected to reach 49 million and 22 million units respectively, despite a significant supply-demand gap [24][27].