Shenwan Hongyuan Securities·2026-03-17 15:28Investment Rating - The report indicates a positive investment outlook for the AI computing network industry, highlighting three key investment directions: optical communication, network equipment and chips, and AIDC computing infrastructure [4][8]. Core Insights - The evolution of AI computing networks is shifting from Scale-out to Scale-up, with significant advancements in optical communication technology and a rapid increase in demand. The report emphasizes the importance of hardware technology solutions and the ongoing domestic replacement of chips within the Ethernet ecosystem [5][8]. - The OFC 2026 event is expected to reveal critical trends in optical communication, including the emergence of NPO and XPO as new competitive arenas, and the full introduction of 400G/lambda technology, signaling the approach of the 3.2T era [37][38]. Summary by Sections 1. Review and Outlook: What Stage is the Industry and Investment At? - The AI-driven technological transformation, particularly in LLM training and inference, has propelled the optical communication industry into a new cycle, with a notable change in the supply-demand relationship compared to previous cycles [14]. - The current architecture is increasingly influenced by computing power, with a significant opening of domestic computing network space as solutions evolve from Scale-out to Scale-up [17][20]. 2. Domestic and International Computing Networks: Two Flowers Blooming - The report identifies key players in the optical communication sector, including Zhongji Xuchuang, Xinyi Sheng, and Tianfu Communication, as well as in computing equipment like Unisplendour and Ruijie Networks [8]. - The report discusses the competitive landscape of optical communication technologies, emphasizing the coexistence of various paths rather than a simple replacement scenario [10][43]. 3. The Debate on xPO: Where is Optical Communication Headed? - The report outlines the competitive dynamics of optical modules, highlighting the significance of pluggable optics and the expected dominance of 800G/1.6T pluggable modules in the AIDC optical interconnect market by 2026-2027 [47]. - It also discusses the potential of CPO (Co-Packaged Optics) and NPO (Near-Packaged Optics) as significant variables in the industry, with expectations for their deployment in the near future [57][60]. 4. Key Trends from OFC 2026 - The report notes that the introduction of 400G/lambda technology and the advancements in optical modules by leading Chinese manufacturers mark a pivotal moment for the industry, indicating a shift towards higher bandwidth and lower power consumption solutions [38][41]. - The report anticipates that the next few years will see a rapid evolution in optical communication technologies, with a focus on diverse paths and product forms, leading to extended opportunities across the industry chain [44][64].