Shenwan Hongyuan Group Co., Ltd. released a research report stating that with the rapid advancement of AI, demand for computing power across various industries is growing sharply. On one hand, the top ten Chinese optical module suppliers hold over 50% of the global market share. On the other hand, overseas companies such as Keysight and Anritsu account for approximately 84% of China's optical communication test instrument market in 2024. In the future, domestic equipment companies are expected to benefit from both industry growth and market share expansion.
Shenwan Hongyuan's main viewpoints are as follows:
AI is driving rapid volume growth in optical module demand. As AI develops quickly, the demand for computing power in various industries is increasing dramatically. Intelligent computing centers, which serve as specialized infrastructure for high-power, high-bandwidth GPU clusters, are seeing rising demand for high-speed optical modules. According to data released by Yole, the global optical module market size surged from $8.78 billion in 2020 to $10.9 billion in 2023, with a compound annual growth rate (CAGR) of 7.5%. The global optical module market is projected to exceed $22.4 billion by 2029, with a CAGR of 11% from 2024 to 2029.
Based on the latest research from TrendForce, high-speed interconnection technology has become a key factor determining the performance ceiling and scalability of AI data centers. Global shipments of optical transceiver modules supporting 800G and above are expected to reach 24 million units in 2025 and are projected to grow to approximately 63 million units by 2026, representing an increase of 2.6 times.
Optical module equipment is critical for the transition from R&D to mass production. Optical module equipment encompasses two core categories: production equipment (packaging, coupling, mounting, etc.) and testing equipment (performance testing, defect detection, aging tests, etc.). The equipment directly determines the yield, performance, and mass production efficiency of optical modules. According to Frost & Sullivan data, the global market size for optical module packaging and testing equipment increased from 590 million yuan in 2020 to 5.18 billion yuan in 2024, achieving a CAGR of 71.8%. Within this, the market size for 800G optical module equipment skyrocketed from 10 million yuan in 2022 to 3.02 billion yuan in 2024, becoming the fastest-growing segment. The market sizes for 800G and 1.6T optical module equipment are forecasted to reach 4.23 billion yuan and 3.82 billion yuan respectively in 2025. The global market size for high-speed optical module packaging equipment is expected to surpass 10.16 billion yuan by 2029, with a CAGR of 13.8% from 2025 to 2029.
The upgrade in optical module speeds to 800G/1.6T and the technological evolution towards silicon photonics/CPO are driving equipment iteration and upgrades. 1) Production equipment: Traditional pluggable optical module production primarily involves mounting and standard coupling. However, 800G/1.6T optical modules and CPO modules require chip mounting accuracy to improve to the ±3-micron level, necessitating optimization of the entire process flow, including coupling and testing. Advanced packaging technologies such as flip-chip bonding for silicon photonic chips and laser-assisted bonding (LAB) are gradually becoming more common, requiring traditional packaging equipment to upgrade towards high precision and multi-process compatibility. 2) Testing equipment: There is a shift from traditional automated optical inspection (AOI) towards high-speed performance testing. 800G/1.6T optical modules require high-end equipment like 120GBaud clock recovery units, 65GHz oscilloscopes, and 1.6T bit error ratio testers, significantly raising the demands for testing accuracy and efficiency. Simultaneously, the promotion of new technologies like LPO and NPO further drives the need for equipment upgrades, pushing up the capital investment per optical module equipment unit.
With optical module supply concentrated in China, domestic equipment manufacturers are facing significant opportunities. It is recommended to focus on: Robotec (coupling equipment), Autowell (AOI inspection equipment), Quick Intelligent (AOI inspection equipment), Dylaser (laser bonding), Crey Technology (coupling equipment), Bozhon Precision (mounting, coupling, automation equipment), GKG Precision (automation equipment),华盛昌 (test instruments),猎奇智能 (mounter, coupling equipment),联讯仪器 (test instruments), XYC (die bonder), ZLF (die bonder), ADAQ Intelligent (automation equipment), JPT (test equipment), and燕麦科技 (test equipment).
Risk warnings include macroeconomic volatility, uncertainties in new technology development, and intensifying industry competition.