Industry Overview - The technology sector is experiencing growth due to digitalization, driven by the rapid deployment of Artificial Intelligence (AI) and cloud computing transition [1] - Strong adoption of AI technologies, including Generative AI and agentic AI, is increasing demand for high-performance computing and data-center infrastructure, leading to higher sales of semiconductors and related services [1] - Industrial automation is being enhanced by AI deployment, with increased usage of the Internet of Things, robotics, and automation [1] - Quantum computing, although in early stages, shows potential in solving complex problems in areas like drug discovery and logistics [1] Semiconductor Market - Massive investments in chips, particularly GPUs and customized accelerators, are driving semiconductor demand [4] - The Semiconductor Industry Association reported that semiconductor sales reached $75.3 billion in November 2025, a 29.8% year-over-year increase and a 3.5% month-over-month increase [4] - In October 2025, semiconductor sales were $72.7 billion, reflecting a 4.7% month-over-month increase and a 27.2% year-over-year increase [4] Company Performance and Earnings Estimates - Sandisk (SNDK) has an Earnings ESP of +3.07% and is expected to benefit from a shift in the NAND flash memory market, driven by AI applications [8][9] - The Zacks Consensus Estimate for Sandisk's earnings has increased to $3.26 per share, with the company set to report results on January 28, 2026 [10][11] - Amphenol (APH) has an Earnings ESP of +3.78% and is scheduled to report results on January 28, 2026, with a consensus earnings estimate of 93 cents per share, indicating 69.1% growth year-over-year [12][13] - ASML Holding has an Earnings ESP of +0.70% and is also set to report on January 28, 2026, with a consensus estimate of $8.85 per share, reflecting 21.2% growth year-over-year [14][16] - Corning (GLW) has an Earnings ESP of +1.72% and is scheduled to report on January 28, 2026, with a steady earnings estimate of 70 cents per share, suggesting 22.8% growth year-over-year [17][19] Investment Outlook - Leading hyperscalers like Amazon, Alphabet, and Microsoft are making multi-year investments to expand cloud capacity and support AI deployment, which bodes well for technology stocks [3] - The combination of strong earnings estimates and positive market trends positions several technology stocks favorably for potential earnings surprises [6][7]

Financial Data and Key Metrics Changes - Fourth quarter revenue reached $910 million, exceeding guidance and up over 20% year-over-year and 4% sequentially [4][11] - Full fiscal year 2025 revenue was a record $3.4 billion, representing a 19% increase from the prior year [5][16] - Non-GAAP EPS for Q4 was $2.65, a new quarterly record, while full year non-GAAP EPS hit $10.17 [5][11] Business Line Data and Key Metrics Changes - Optical Communications revenue was $689 million, up 15% year-over-year and 5% sequentially, with telecom revenue at $412 million, a 46% increase from a year ago [12][16] - Datacom revenue was $277 million, down 12% year-over-year but up 10% sequentially, driven by demand for higher data rate products [13][19] - Non-optical communications revenue was $221 million, a 41% increase year-over-year and 3% sequentially, with automotive revenue at $128 million [14][16] Market Data and Key Metrics Changes - Telecom revenue growth was primarily driven by data center interconnect (DCI) products, which represented 12% of overall revenue at $107 million [12][19] - DCI revenue grew 45% year-over-year, indicating strong demand trends [7][68] - The automotive segment showed a slight decline but performed better than expected, while industrial laser revenue remained stable [9][14] Company Strategy and Development Direction - The company established a significant partnership with Amazon Web Services, expected to be a meaningful revenue driver in fiscal year 2026 [5][79] - Construction began on Building 10, which will add 2 million square feet of capacity, with plans to accelerate completion due to increasing customer demand [5][17] - The company is introducing a new revenue category for high-performance computing (HPC) to better capture growth in this area [20][79] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism for fiscal year 2026, citing strong customer demand and multiple growth drivers [6][19] - There are temporary component supply challenges impacting Datacom revenue, but these are expected to be resolved [9][54] - The company anticipates healthy year-over-year and sequential growth in Q1, with revenue guidance between $910 million and $950 million [21][19] Other Important Information - The company returned $126 million to shareholders through a buyback program, with continued repurchases expected in fiscal year 2026 [5][18] - The effective GAAP tax rate was 6.5%, and the company ended the year with cash and short-term investments of $934 million [16][17] Q&A Session Summary Question: Clarification on Datacom revenue dip - Management clarified that the expected dip in Datacom revenue for September does not include contributions from the new HPC segment, which will be reported separately [25][26] Question: Future hyperscaler transceiver opportunities - Management indicated that future hyperscaler opportunities would predominantly be on 1.6 terabit port speeds, while 800 gig opportunities remain [27][28] Question: Growth prospects for fiscal year 2026 - Management remains optimistic about growth prospects, citing strong demand for 1.6 terabit products and continued telecom trends [36][38] Question: Impact of component shortages on Datacom - Management acknowledged that component shortages are causing a temporary dip in Datacom revenue but expressed confidence in resolving these issues [54][55] Question: Amazon PCB business potential - Management believes the Amazon PCB business could represent a significant opportunity, with revenue expected to ramp in fiscal Q1 [78][79] Question: Visibility on 800 gig demand - Management confirmed good visibility on 800 gig demand, indicating that supply constraints are currently more of an issue than demand constraints [87][88] Question: Tariffs impact - Management stated that they have not seen significant impacts from tariffs, as shipping terms place the responsibility on customers [90][91]