Core Viewpoint - The demand for optical fibers and cables is being profoundly reshaped by AI, leading the industry into a new supply-demand cycle, with a potential supply shortage expected in the next two years [1] Group 1: AI Impact on Demand - AI is projected to account for 35% of the downstream demand for optical fibers and cables by 2027 [1] - The growth in AI is driving the construction of data centers, which has previously received limited attention due to the high proportion of traditional telecom demand [1] - The demand for optical fibers and cables is expected to rise from less than 5% in 2024 to 35% by 2027, resulting in a global fiber demand of 880 million core kilometers by 2027 [1] Group 2: Supply Dynamics - The global supply of optical fiber rods is currently around 25,000 tons, with a cautious expansion attitude from existing manufacturers [2] - The production capacity of optical fiber rods is expected to grow to approximately 26,000 tons by 2027, with annual supply capacity for optical fibers reaching about 850 million core kilometers, which may fall short of annual demand [2] Group 3: Market Concerns - Supply shortages are anticipated to first occur in North America, where AI demand is highest, while Chinese manufacturers have limited exposure [3] - Domestic operators may not benefit from price elasticity in the short term due to the centralized procurement mechanism [3] - The revenue share of domestic operators for leading companies has decreased to below 40%, with potential profit elasticity expected to be realized after the next procurement cycle [3]