BOSTON (June 18, 2026) – Market research firm Cignal AI recently published the 1Q26 Optical Components Report, which describes a market being radically reshaped by hyperscaler AI investment.
Datacom optical component revenue reached a record $7.7 billion in the quarter, more than doubling year-over-year, while telecom optical component revenue set its own record at $2.0 billion. The quarter also marked an inflection in next-generation optics: 1.6TbE datacenter modules ramped up sharply, and 800ZR+ coherent pluggables began shipping into their first large scale-across deployments.
The 1Q26 edition of the Optical Component Report is the first to combine quantitative component tracking for co-packaged optics (CPO) port deployment and the optical circuit switching (OCS) market into a single quarterly publication. This builds on Cignal AI’s leading ELSFP-based CPO forecast initiated earlier this year.
“AI is setting shipment unit records for optics across the board, and the pace is only accelerating. 800GbE optics shipments show no sign of slowing, 1.6TbE is ramping faster than we expected a quarter ago, and component shortages are slowing the usual price declines,” said Scott Wilkinson, Lead Analyst for Optical Components at Cignal AI. “Outside the datacenter, the race to fill Meta’s 800ZR+ scale-across orders has begun, with Acacia taking an early lead.”
Vendors are ranked by total optical component revenue and by unit shipments of 400G+ datacom modules and coherent modules.
Highlights from the 1Q26 Optical Components Report:
- High-speed (400G+) datacom module shipments set a record; up 145% year-over-year. Innolight again topped the leaderboard in both Datacom revenue and high-speed module shipments, by a wide margin. Almost 20 million modules shipped in the quarter as AI build-outs accelerated.
- 800GbE now accounts for the majority of high-speed datacom module shipments, and unit shipments will more than double in 2026. Volumes more than tripled year-over-year, and 800GbE will remain the workhorse of AI datacenters even as 1.6TbE begins shipping in volume.
- 1.6TbE module shipments grew 50% sequentially and will exceed 10 million units in 2026. Nearly all 1.6TbE optics currently ship in DR (silicon photonics) configurations.
- 800ZR+ pluggable shipments surged as the first large scale-across deployments began at Meta. Cignal AI expects 800ZR+ to easily reach existing forecasts for 2026 as additional suppliers ramp into volume.
- CPO deployments are imminent with Nvidia, Broadcom, and TSMC advancing 200G/lane platforms. CPO port deployment begins modestly in 2026 and is forecast to grow to tens of millions of ports annually by 2030 as it expands from the scale-out into the scale-up network.
- The report integrates Cignal AI’s forecast for optical circuit switching. The OCS total addressable market – excluding Google’s internal deployments – is forecast to exceed $1 billion this year and grow several-fold by 2030, driven primarily by AI cluster reconfiguration in TPU-based networks.
Live Presentation Available
Results from Cignal AI’s Optical Components Report are presented live each quarter by Lead Analyst Scott Wilkinson. Clients are welcome to register to attend the presentation Tuesday, June 23rd, 2026 at 11AM or be notified when a replay and slide download are available.
About the Report
Cignal AI’s Optical Components Report is published quarterly and provides revenue-based market share of company sales into four optical component markets: Datacom, Telecom, Industrial, and Consumer. The report also tracks detailed unit shipments and total market size of datacom and telecom components, including 400GbE / 800GbE / 1.6TbE datacom transceivers used for intra-datacenter applications, as well as 400ZR / 800ZR pluggable and embedded coherent transceivers for telecom applications. Beginning this quarter, quantitative forecasts for co-packaged optics (CPO) port deployment, the ELSFPs that power CPO, and optical circuit switching (OCS) are integrated as part of the report.
Five-year forecasts are provided for all revenue segments as well as detailed unit shipments. Data, including forecasts, are updated continuously as new information becomes available and as market events impact the industry outlook.
Companies included in the report are Acacia, Accelink, Adtran, ADVA, Applied Optoelectronics, Broadex, Ciena, Cisco, Coherent, Emcore, Eoptolink, Fiberhome, Finisar, 1Finity, Furukawa Electric, Furukawa FITEL, HG Genuine, Huawei, Hisense Broadband, Infinera, Innolight, Inphi, Intel, IPG Photonics, Jabil, Lumentum, Marvell, Mitsubishi, Molex, NEC, Neophotonics, Nokia, O-Net Technologies, OE Solutions, PacketLight, SONT Technology, Source Photonics, Sumitomo, Sumitomo Osaka Cement, and ZTE.
A full description of the report methodology, including an up-to-date listing of all product categories as well as reports and presentations, is available on the report page.
About Cignal AI
Cignal AI provides active and insightful market research for the networking component and equipment market and the market’s end customers. Our work blends expertise from a variety of disciplines to create a uniquely informed perspective on the evolution of networking communications.
Our research is relied on by leading optical component makers, system vendors, hyperscalers, and investors across the networking industry. A sample of these customers are indicated at the link below.
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