A long-cycle signal for semiconductor sector momentum! U.S. stocks in storage and optical communications gain strength; DRAM supply may remain tight through 2028

(Source: Caixin Finance)
OpenAI said that its new Jalapeno chip performed better in testing than NVIDIA's current product lineup, highlighting the company's progress in developing its own AI processors.
Most U.S. stocks in the optical communications and storage sectors rose. Lumentum jumped more than 6%, Applied Optoelectronics rose more than 5%, Seagate Technology (STX.US) climbed 3.40%, Western Digital (WDC.US) rose 3.53%, SK hynix (SKHY.US) increased 2.68%, and Micron Technology (MU.US) gained 2.48%.
In terms of news flow, OpenAI said that its new Jalapeno chip performed better in testing than the current product lineup of NVIDIA (NVDA.US), highlighting the company's progress in developing its own AI processors.
Currently, the four largest overseas cloud service providers have raised their 2026 capital expenditure guidance. Google and Amazon (AMZN.US) increased their guidance significantly. Microsoft (MSFT.US) lowered its guidance on a reported basis, but its actual investment plan remains unchanged. Capital expenditure achievement in the first half of the year was relatively low; in the second half, the spending scale is expected to rise sharply. Infrastructure for computing power has long-term rigid support. Strong downstream demand is keeping orders for optical modules full. Delivery capability for high-end products has become a scarce resource. Upgrades in AI cluster bandwidth are driving the shift from optical-to-copper (“optical in, copper out”). Technology iterations for NPO and CPO are being implemented. The introduction of high-margin new products is lifting the industry’s profit-center. Sector optimism is supported both by current earnings delivery and forward growth expectations, and further reinforced as upstream raw-material disruptions ease. Optical-module product iteration is accelerating and the share of high-margin products is increasing, suggesting the industry could achieve high earnings growth.
Goldman Sachs released its latest research report, sharply raising its 2026–2028 global wafer-fabrication equipment WFE spending forecasts, to $150 billion, $218 billion, and $281 billion, respectively, implying growth rates of 36%, 45%, and 29%. The firm believes that the current semiconductor equipment upcycle may extend through 2028. The upward revisions are driven by above-expected results and capital expenditure guidance from U.S.-listed semiconductor companies. On the foundry side, TSMC (TSM.US)’s large-scale expansion of its N2 2-nanometer process benefits the sector. For the DRAM segment, capital expenditure is being supported by Samsung and SK Hynix, and DRAM supply tightness is expected to continue through 2028.