On August 11, Applied Optoelectronics fell 5.13% in pre-market trading, trading at approximately $126.49/share with turnover of $12.62 million, pulling back after accumulating nearly 20% gains over the prior two trading sessions.

On the news front, B. Riley cut its target price on AAOI from $129 to $109 while maintaining a neutral rating, placing the target significantly below the current stock price. Additionally, the company's Q3 guidance issued alongside its Q2 earnings fell short of Wall Street expectations — projecting adjusted EPS of $0.11 to $0.26 versus the consensus estimate of $0.28, and revenue of $255 million to $290 million versus the $278.3 million consensus. While Q2 results were strong with revenue of $191.9 million representing 86% year-over-year growth and data center revenue surpassing $100 million for the first time, the combination of a below-consensus forward outlook and the target price reduction triggered profit-taking pressure following the sharp recent rally.

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