2026-03-17 04:20Investment Rating - The report maintains a rating of "Outperform" for the industry [5] Core Insights - Nvidia has announced a strategic investment of $4 billion in the optical communication industry, partnering with Lumentum and Coherent [9][14] - Broadcom has launched the first single-channel 400G DSP, optimized for 1.6T transceiver solutions, addressing the growing bandwidth demands of AI data centers [9][16] - The communication sector has seen a slight decline, with the overall index down by 0.7% over the past two weeks, while operators have shown resilience [19][26] Market Review - The communication industry index has decreased by 0.7% over the past two weeks, ranking 10th among 31 sectors [2][19] - The overall dynamic PE ratio for the communication sector is approximately 52.77 times as of March 13, 2026, indicating a high valuation level compared to the historical average of 32.51 times [23] - In terms of sub-sectors, operators, submarine cables, and North American AI sectors have shown the highest gains, with increases of 5.9%, 3.8%, and 1.2% respectively [26] Configuration Recommendations - The report suggests focusing on the core segments of the computing power industry chain, including new technology penetration and the improvement of domestic supply chains [3][34] - Key areas of interest include optical modules, copper interconnects, switches, temperature control equipment, power supply, IDC rooms, edge AI, and satellite communications [3][34]