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Non-Tech : Kirk's Market Thoughts
COHR 139.28-0.5%Nov 14 9:30 AM EST
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To: Elroy who wrote (25557)8/14/2025 10:01:27 AM
From: Kirk ©  Read Replies (1) of 26512
 
I'm pretty sure they build their optical transceivers and if you trace their DNA back to the 1980s and 90s... you find my fingerprints. When they broke up HP after I left, one of the guys I worked with and for (different projects) went to Finisar (now Coherent) to be their R&D manager to do the fiber optic links. We did one of the first links for IBM with volume better than anyone else and to get the business, you sell it BELOW loaded cost then work on cost reduction. That means crap margins to get business while in low volume.

The "moat" is you learn to build these things at a profit using past experience. A lot of the tricks we didn't get patents for as that would give away the secrets. The trouble is Coherent can get the business from Broadcom (what our fiber optic department eventually landed) by hiring away key players, just like the AI companies are hiring away engineering managers from each other now.

I think for the past 2 yrs or maybe longer, Finisar/II-VI/Coherent has had more orders for fiber optic transceivers for data centers than they can build. Don't ask me why as I've been out for over 30 years but my last task in fiber was to lead a fairly large "cost reduction" team for our best, high performance module while also doing the design for the optical preamp.

The VCSELS could be a high margin business....
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